New Mortgage Rules Effective January 1, 2018
October 28, 2017 | Posted by: Dennis Street
IMPORTANT – New Mortgage Rules Effective January 1, 2018.
Purchase before year end if you have 20% downpayment, otherwise you may have to buy 20% less home! If you need to pay off large amounts of credit card debt, are thinking of a large renovation, or want to buy an investment property, you should also act before year end. These new mortgage rules will reduce your purchasing power and affect your ability to access your home equity. Get in touch ASAP to understand the changes and review your options!
Beginning January 1, 2018, a new 'stress test' will be applied to all new conventional mortgages – and not just those mortgages that require mortgage insurance (downpayment or equity of less than 20%).
The so-called “stress test” is designed to protect homeowners should interest rates rise. Lenders will be obligated to qualify all new conventional mortgages at the greater of the Bank of Canada’s five-year benchmark rate (currently 4.99%) or the contracted rate plus 2%. So if your contract rate is 3.29%, you will be qualified at 5.29%.
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We regularly receive short-term rate promotions that are not posted online, which means our rates change frequently. Please contact us for these unpublished rate specials.