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...
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:...
Effective this week, it gets a little easier to buy a house or refinance. On Saturday, BMO and CIBC shaved 15 basis points off their posted 5-year fixed rates. That’s enough to drop the benchmark 5-year posted rate to 4.79%. Given regulators use this benchmark rate to calculate Canada’s minimum mortgage stress test, today’s cuts mean you’ll now need less...
—The Mortgage Report: July 23— Forget Posted-rate Cash-back Mortgages: Many borrowers with less than 20% down aren’t just short on down payment funds, they’re short on closing costs too. And that’s a problem, because lenders want to ensure buyers have at least 1.5% of the purchase price available for closing costs. If you can’t easily swing that, there are 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...
—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 Report – June 12 Deferrals Appearing on Credit Reports: Credit bureaus are alerting lenders when you’ve requested a payment deferral. If you’ve deferred your mortgage, Equifax says you should see one or both of these statements in the comments section of your credit report: Deferred Payment Affected by Natural or Declared Disaster Mortgage deferrals aren’t supposed to hurt...
The Mortgage Report – May 26 Stress Test Exception: Here’s a tip for renewers. If: A) you want to switch to a new lender at renewal, and B) your mortgage closedbeforeOctober 16, 2016,and C) you haven’t refinanced since… …then some lenders let you qualify at their best 5-year fixed rates instead of at the government’s “stress test” rate (which is...
The Mortgage Report – May 16 Now to 4.94%: Scotiabank trimmed its posted 5-year fixed rate to 4.94% on Saturday. That puts the mode average of the Big 6 Banks’ 5-year posted rates—and hence the minimum stress test rate—at 4.94%. Of note: This is the lowest the stress test rate has been since October 2017 The all-time low was 4.64%,...
Mortgage Report – May 14 De-Stressing: Call out the marching band, BMO’s posted 5-year rate cut today should ease the government’s mortgage “stress test,” effective next week. As it stands, the minimum stress test rate will likely fall from today’s 5.04% to 4.99%. It’ll mark the first time since January 2018 (when OSFI’s stress test began) that this benchmark rate...
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