Whether you are a resident of Canada or even a non-resident (living and working abroad), you are probably wondering how to keep purchasing and/or refinancing when the mortgage rules keep changing like the wind!
Since last October, we have seen massive changes – everything from increased rates, properties that were previously insured are now uninsured and the qualifying rate for everything under the 5-year fixed has risen three times.
So with these massive changes how do you keep up? How do you purchase when the mortgage rules keep changing?
As brokers, we deal with these frustrations every day and the answer unfortunately is not clear!
It’s no news that the new mortgage rules have thrown everyone into a tizzy! Not only, are there new rules, but now there is new terminology and a new way of thinking we need to adopt, so I thought it would be a great primer to spell it out in this blog post.
Before November 30, 2016 we would assess a Purchase in terms of Conventional or High Ratio. Now we need to look at a Purchase in terms of Insurable or Un-Insurable. Note all refinances are considered Un-Insurable.
So how does this affect you?
Booya and the Government changes the mortgage rules again!
This past week the Trudeau Government took us all by surprise by announcing new mortgage qualification rules. The mortgage industry and the media have gone wild with speculation and concern about the future of our industry, but what does this mean for you and how do you navigate these changes going forward?
Currently in place, the Government has required homeowners with less than 20% down to qualify at the BOC rate of 4.64% for any term less than a 5-year fixed rate. Effective October 17, 2016, this requirement will apply to all insured mortgages, including fixed-rate mortgages with terms of five years or more.