More mortgage rules changes
Further to our announcement on October 17, 2016, lenders continue to make changes to their business resulting from the changes announced from the Government of Canada on October 3, 2016. Specifically, the Department of Finance released a Technical Backgrounder: Housing Insurance rules and Income Tax Proposals (Revised October 14, 2016).
As you are aware, mortgages are insurable in Canada on a high-ratio or low ratio basis. As a result of the changes announced by the Government of Canada, they have restricted the eligibility of certain prime conventional mortgages from being insured. As a result, the cost of funding these "un-insurable" mortgages has increased. The requirements of a mortgage to be insured must include, but are not limited, to the following criteria:
- Purchase price maximum $999,999.00
- Mortgage is a Purchase Transaction only
- Minimum Beacon Score 600
- GDS and TDS Maximum 39/44
- Maximum Amortization 25 years
Stay tuned for more news to follow !