The new posted-rate qualification rulekicked in today on high-ratio insured mortgages. Itcouldshut out more buyers from the housing market than any single mortgage change since the late ’70s, when rates soared into the teens. That’s according to one lender veteran I spoke with this morning. The lender, who didn’t want to be identified for fear of regulator reprisal, called Ottawa’s...
The policy dudes at the Department of Finance (DoF) havedeferred the implementation date for theircontroversial new posted-rate “stress test.” The changeapplies to low-ratio insured mortgages and gives people more time toplan a purchase or refinance. When the new ruleswere first announced, the DoF said that effective Oct. 17all insured borrowers would have to prove they can afford a higher payment...
“Since 2007, the share of all banking assets controlled by the largest six banks grew from 90% to 93%.”—John Jason, C.D. Howe ******* Fine time to land acrushingregulatory uppercuton bank challengers. That’s what the good intentioned folks in Ottawa did this week when they turned the tables onborrowers and mortgage competition. (Those details)In doing so, the Finance Department left borrowers...
The government dropped a bomb on the mortgage industrytoday, and disguised it as a firecracker. Policy-makers imposed a range of new measures with the stated goal of improvinghousing “stability.” Here’s asummary from the Department of Finance –> DoF Press Release. Preliminary official estimates are that 1 in 12 homebuyers could be affected. I don’t buy it. We’ve heard from numerous...
This past week, Canada’s bank regulator (OSFI)toldlenders toconsider increasing the hypothetical interest rates they use when stress testing applicants’ mortgage payments. Currently, if you’re getting a variable or 1- to 4-year fixed term, lenders typicallycheck to ensure you can afford a payment at the Bank of Canada’s “qualifying rate” — i.e.,the mode average of the Big 6 banks’ 5-year posted...
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