We’re one week into 2018, OSFI’s new mortgage stress test is live and the earth is still spinning on its axis. But that axis is now tilted…in credit unions’ favour. If you’re a mortgage shopper who’s been turned down by a bank—courtesy of the aforementioned new mortgage rules—then credit unions want to talk to you. Credit unions aren’t bound by...
Big-city home values were out of control. The real estate market needed de-risking. But the solution policy-makers gave us (the B-20 mortgage guideline) was imperfect, very imperfect. What’s About to Happen Effective January 1, 2018, the banking regulator (OSFI) will force the vast majority of low-ratio mortgage applicants to prove they can afford a payment based on a rate that’s...
Renewing a mortgage could soon get a lot more costly for 700,000+ Canadian families. And they’ll have OSFI to thank. The banking regulator’s new stress test will drive up debt ratio calculations for most conventional borrowers by 6 to 7 percentage points. That’s enough to push a minority of renewers right out of the qualification zone. Why this matters:Lenders use...
Canada’s new “B-20” mortgage stress test will be a tectonic shift for the roughly 1 in 6 borrowers it affects, starting January 1. It’s going to force higher-indebted creditworthy borrowers to either: reduce their loan amount, seek help qualifying (e.g., find a bigger down payment or co-signor), defer their homebuying plans, or seek out a non-bank lender, like a credit...
If you’re among theroughly 1 in 6 conventional borrowers withthe highest debt ratios, OSFI’s new mortgage stress test could keep you from: buying the home youwant (which may be a good thing) renewing at better rates with another lender, or refinancing to lower your debt burden. That’s making hundreds of thousands of borrowers somewhat anxious.It’s why we’re seeing a small...
On Tuesday thegovernmentannounced a January 1, 2018, implementation date for its new uninsured mortgage stress test. In that announcement it said something else thatmany glossed over: “Where possible,federally regulated financial institutions are expected to comply with the principles and expectations set out in this guideline as of the date of this letter [October 17, 2017].” OSFItold ustoday, “Banks are expected...
log in
