Our federal government is once again trying to control the Canadian mortgage market.
Effective January 1st, 2018, watch for the following changes for the qualifications of mortgages in Canada. Another “stress test” condition will be facing consumers for all mortgages from the prime lenders. Currently the new rules only apply to high ratio mortgages(20% or less down payment)
In the new year the rules are changing and they apply to all mortgages:
You will have to qualify at either 2% over the actual contract rate or the benchmark rate, whichever is higher.
eg: If the current 5 year fixed is 3.39%, you will have to qualify at the rate of 5.39%
This change alone will keep many first time buyers out of the market and curtail those from doing refi’s to pay down that expensive credit card debt.
How is this helping Canadians?? Call your MP now to voice your concerns.
If you are thinking of applying for a mortgage or doing a refinance, try to beat this deadline as you may not qualify in the new year.