NEW MORTGAGE RULES

 

Concern over rising consumer debt levels has prompted Ottawa to make implement the following three new changes to Canada’s mortgage rules.
  1. Reduce the maximum amortization period to 30 years from 35 years for government-backed insured mortgages with loan-to-value ratios of more than 80 per cent. Buyers with a deposit of 20% or more will not be affect.
  2. Lower the maximum amount Canadians can borrow in refinancing their mortgages to 85 per cent from 90 per cent of the value of their homes.
  3. Withdraw government insurance backing on lines of credit secured by homes.

The changes to the mortgage insurance guarantee framework will come into force on March 18, 2011. The withdrawal of government insurance backing on lines of credit secured by homes will come into force on April 18, 2011.

Source: The Globe and Mail

2 Responses to “NEW MORTGAGE RULES”

  1. Jazzie Casas

    2010 was kinda a bizarre year for the mortgage market. In the first half of the year, you had a decent number of home sales keeping mortgages for purchases stable, thanks to the home buyer credit. In the second half of the year, that changed as demand crumbled when the credit was withdrawn. At the same time, you had very low mortgage interest rates throughout much of the year cause a mini-refinancing boom. 2011 will look very different, as the housing demand continues to struggle and mortgage interest rates have begun rising.

    Reply
  2. Sabrina

    The rules stated above are indeed very helpful. Thank you for sharing.

    Reply

Leave a Reply

* Mandatory info