Categories for Mortgage Rules

2020 Mortgage Stress Test: More Lift for Housing

Some experts downplayed the effects of the new mortgage stress test last week. The roughly 3% improvement in home-buying power—a result of the government lowering the qualifying rate—apparently didn’t impress them. And while we’re loath to overplay the new stress test’s significance, it seems that some analysts’ attempts to quantify the housing impact may be lacking. Quick Explainer: Mortgage borrowers must...

The Mortgage Stress Test Changes

The Department of Finance today announced changes to Canada’s benchmark qualifying rate, a key component used in stress-testing insured mortgages. The new benchmark rate will come into effect on April 6, 2020. It means insured borrowers (including those buying with less than a 20% down payment) will have to prove they can afford a monthly payment based on a rate...

Allow Fee-Only Mortgage Brokers in B.C.: Opinion

Sometimes well-intended rules and regulations cost consumers money. Here’s a perfect example… British Columbia currently has a prohibition on charging fees for mortgage advice unless those fees are deducted from the mortgage amount at closing. The rule was designed to prevent brokers from taking money from unsuspecting consumers and then not providing the financing requested. It’s a rule that’s served a...

Election Predictions: Housing Impacts

On Monday night we’ll find out which “housing affordability” plan Canada gets, be it from the Conservatives, Liberals or NDP. All three parties are promising to put homes more within reach, particularly for first-time buyers. Some of their proposals are merely vote bait; some are genuinely productive. After listening to the rhetoric for weeks on end, we’ve formulated three observations. Here are...

First-Time Home Buyer Subsidy Starts Today

After five months of buildup, the government’s controversial First-Time Home Buyer Incentive is now live. Kind of. Applications for the program, which lowers borrowers’ interest and default insurance costs (using taxpayer dollars that may or may not be recouped), are supposed to be available here. But the forms aren’t on the government’s website yet, despite the September 2 launch date....

Siddall vs. Taylor: Housing Heavyweights Square Off (RateSpy Editorial)

Rarely have the heads of Canada’s housing agency and largest mortgage broker association been at such odds publicly. It feels like CMHC boss Evan Siddall and Mortgage Professionals Canada (MPC) chief Paul Taylor want to get in the ring and beat the stuffing out of each other. The former published his latest in a series of missives denouncing opponents of...

Scheer Promises to End Mortgage Stress Test on Switches

One of the worst mortgage policies in Canadian history could come to an end by next year. That is, if the Conservatives win the October 21 federal election. Conservative Party leader Andrew Scheer summarized the problem for the Canadian Home Builders’ Association on Friday, saying: “If you want to switch lenders you have to go through the stress test. But if...

More Details on the First-Time Home Buyer Incentive

If you’ve been waiting for facts on the government’s new First-Time Home Buyer Incentive (FTHBI), read on. In a statement today, CMHC said “we still have work to do” before bringing it to market. Among other things, it says: “…The proposal requires some government approvals.” “We also plan to consult with lenders and other industry participants to make sure the...

The Government Cooks Up a Convoluted Mortgage Affordability Scheme

After all the build-up, Canada’s federal budget is finally here. There was no easing to maximum mortgage amortizations or the mortgage stress test, as some had expected. What the government did was throw Canadian mortgage shoppers two bones, with lots of strings attached. Here’s a detailed look at two of the ways the Liberal government proposes to “ease” housing affordability....

Finance Official Rejects Idea of Stress Testing Private Lenders

Reuters reported Friday that regulators were considering drastic new restrictions on private lending. But given the newswire’s anonymous sources, no one has been able to validate the reporter’s claims. We’re now hearing that Mortgage Professionals Canada President, Paul Taylor, spoke with the Ministry of Finance about the article on Friday. According to an internal memo at MPC, a senior policy advisor at...