Not much to see at today’s Bank of Canada meeting. It was another yawner as prime rate held at 3.20%. Among the few takeaways: The Bank stated: “While higher interest rates will likely be required over time, Governing Council will continue to be cautious…” Interpreted this means: Higher rates are on their way, between now and when we die. If...
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...
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