More TIGHTER / TOUGHER Mortgage Rules on the WAY!!!
Monday Oct 23rd, 2017Share
TALK ABOUT TAKING ADVANTAGE WHEN YOU ARE DOWN?!!??...
Very important read on what OFSI (Office of the Superintendent of Financial Institutions) is now going to put in place for people looking for a a conventional mortgage. This is for either purchases of 20% down payment or more or people looking to refinance their exisiting mortgage under 80% loan to value.
OFSI is trying explain the reasoning here because even those home buyers who don’t need mortgage insurance because they have a 20% down payment will now need to show they can make the minimun payment if the interest rates rise above the five-year benchmark rate published by the Bank of Canada or 2% higher than their contracted mortgage rate, whichever is higher.
This, right now, will harm the chances for a lot of first time home buyers who had the 20% or more down to now qualify based on the new rules even if they are no in need of mortgage insurance. This will take away a lot of choice for mortgage options for clients put in this situation. The rules are favoring more the banks then the mono lenders where a lot of lower cost mortgages are available through the mortgage broker channels and a lot of buyers go to get better rates then what the banks were offering to the clients.