Tag Archive: OSFI


Late Breaking News from OSFI on its New Stress Test

Important Clarifications… Here’s more of what you need to know about the new stress test rules, straight from the regulator: On the Need to Act Now 25.6% of uninsured mortgages originated between July and December 2020 had a “qualified TDS” above 43%, OSFI says. 44% is the limit, and for a healthy market you really want to see that number...

New Uninsured Mortgage Stress Test Starts June 1

Here’s the latest on what we know about the banking regulator’s new mortgage stress test proposal… 12:10 p.m. ET Update OSFI has proposed a tougher minimum qualifying rate for uninsured mortgages. As planned, it will be the higher of: the mortgage contract rate plus 2%, or a 5.25% floor rate That 5.25% floor is 0.46%-pts higher than the current minimum...

OSFI Resumes Its Stress Test Review

For those who think the 4.79% minimum qualifying rate (mortgage “stress test” rate) is too strict, here’s a breaking update. Tweaks to the often-criticized “stress test” are back on the table. OSFI said today that it “will resume its policy work on the minimum qualifying rate for uninsured mortgages by issuing a new consultation tomorrow at noon (ET).” “OnJanuary 24,...

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...

OSFI on When It Will Reassess the New Stress Test

On March 13, 2020, our banking regulator suspended its work on improving Canada’s uninsured mortgage stress test. Its decision was made in response to challenges posed by COVID-19. Prior to that, OSFI had indicated that a new and improved stress test would start as soon as April 6, 2020, pending public consultation and review. At the time, the regulator acknowledged...

How Some People Still Beat the Mortgage Stress Test

Grandfathering Remains in Effect Okay, you really shouldn’t be as happy as these people if you have to do an end-around to pass the stress test, but nonetheless… If you’re switching lenders to get a better deal, the best 5-year mortgage rates are usually available only on insured or insurable mortgages. And that’s a problem if your property value has...

Internal Emails From OSFI Document its Stress Test Tweaks

—The Mortgage Report: June 25— OSFI Unplugged: Alberta MP Tom Kmiec has obtained internal emails from OSFI that chronicle the regulator’s efforts to improve the mortgage stress test—in particular its efforts to “fix” the minimum qualifying rate (a.k.a., “MQR” or benchmark rate). The emails show that OSFI’s PR staff wanted the public to know it was making “efforts to get...

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...

OSFI’s Mortgage Update Raises Questions

Don’t worry about the nagging side effects from the federal mortgage stress test. You might have heard about them in the media, but based on recent stats shared by the banking regulator, they’re overblown. Nothing to see here… Well, actually, there is more to see. OSFI’s latest assertions raise just as many questions as answers. Here were six points from its January...

The Mortgage Stress Test May Get More Reasonable

Here’s some good news for people who’ve been blocked from qualifying for a mortgage due to the government’s “stress test.” Canada’s banking regulator (OSFI) is taking a second look at the mortgage stress test calculation, which requires borrowers who are not default insured to prove they can afford a monthly payment at the greater of: (A)  Their actual mortgage rate...