New Rules for Mortgage Qualification

Ottawa has announced new rules in response to concerns that some markets in Canada are overheated and that Canadian debt levels continue to increase. These changes are meant to alleviate risk in Canada’s housing market but may have a significant impact on the housing market.

Some Highlights:
  • Effective October 17th, all insured mortgages will  require borrowers prove they can qualify based on a higher mortgage rate set by the Bank of Canada called the "benchmark rate". This measure was previously in place for mortgages with terms less than 5 years or variable rate mortgages, but will now apply to all mortgages, including 5-year fixed rate mortgages.
  • Starting November 30th, all portfolio, or bulk insured mortgages will also need to meet the more stringent qualification requirements.  All portfolio insured mortgages must also be owner occupied- no rentals or investment properties, maximum amortization of 25 years and the maximum purchase price/value of is $1 million.
  • Effective October 3rd, a tax loophole that allowed non-residents to buy homes in Canada and then get a tax exemption to avoid paying capital gains when they sell that home by claiming it as a principal residence was eliminated. This increased scrutiny will ensure that the capital gain exemption is not abused, specifically by preventing non-residents from becoming residents then buying and selling a property in the same year.
  • The Government will continuously monitor the housing market to ensure that Canada’s housing finance system is healthy, competitive and stable by ensuring the market is balanced and appropriately reflects all parties’ abilities to share in the management of housing risks.

WHAT DOES THIS MEAN FOR YOU?

I am  reviewing these changes for its deeper implications and will keep you informed. If you think that you may be impacted by these recent changes, please let me know so I can confirm that for you.  CONTACT LYSA HERE

There's alot of choices in mortgages right now, and most Canadian homebuyers end up paying too much for their mortgage because they don't have the knowledge or time to find the product that is the best fit for them.  That's where I can help.  It's the highest form of a compliment to be recommended.  My mortgage business comes from many sources- but referrals from you rank at the top of my list.
Please remember to pass my name along to anyone that may benefit from my knowledge and expertise.
Give me a Call...let's have coffee!

Lysa Dixon
604.817.1751
lysa@averbachmortgages.com
lysadixon.com

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Lysa Dixon
p: 604.817.1751
f: 604.215.4328
email: lysa@averbachmortgages.com
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