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Categories for Mortgage Rules

First-Time Home Buyer Incentive Revamped

The Liberal government wants to give its much-criticized First-Time Home Buyer Incentive (FTHBI) a redo. In its Fall Economic Statement this week, the government said it’s going to make it easier for borrowers to qualify. Effective “spring 2021,” first-timers who use the program will be able to purchase a home up to 4.5 times their household income (currently four times)...

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OSFI on Reviewing the Stress Test Rate

If you’re hoping the mortgage stress test gets easier—so you can qualify for bank financing—you’ve got more waiting to do. Canada’s banking regulator, OSFI, says it’s not ready to adjust the stress test just yet, despite proposing last February to ease it. OSFI spokesperson Michael Toope tells us: “On March 13, 2020, OSFI suspended all of its consultations and policy...

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Morneau Out. The Mortgage Impact

Canada’s Finance Minister influences the mortgage market more than any other politician, and now we’re getting a new one. Finance Minister Bill Morneau, who’s held that role since November 4, 2015, is out. He resigned today. To say Morneau was pro-mortgage tightening is an understatement. The 57-year-old Liberal cabinet minister presided over numerous impactful changes to Canada’s mortgage market, including:...

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Industry Leader Calls for Stress Test Fixes Now

—The Mortgage Report: June 29— Stress Test Fix Overdue: Ottawa was sensible to pause the mortgage stress test changes “given the marketplace uncertainty in March,” says Paul Taylor, President and CEO, Mortgage Professionals Canada (MPC). “However, as we begin to open businesses again, and as economists are generally expecting a housing price downturn, now is the time for OSFI and...

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Ominous Data From CMHC

The Mortgage Report – May 19 5% Down Payments at Risk? Canada’s housing agency says it must “avoid exposing young people” and “taxpayers” to “amplified losses that result from falling house prices.” CMHC CEO Evan Siddall said today, “Unless we act, a first-time homebuyer purchasing a $300,000 home with a 5% down payment stands to lose over $45,000 on their...

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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...

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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...

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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 unlessthose 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...

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Election Predictions: Housing Impacts

On Monday night we’ll find out which “housing affordability”plan Canada gets, be it from theConservatives, 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...

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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....

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