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Anticipating a New Set of Mortgage Regulations

General Kaveh Seyedsagha 2 May

April is typically a very busy month for the mortgage industry, and this year has been no different. After a rapid series of interest rate hikes put a chill on real estate activity over the past year, the market is showing early signs of recovery.

As CMI(Canadian Mortgage Investments) mentions, Demand for private mortgages is expected to remain robust as the market anticipates the potential introduction of a new set of lending guidelines that will make it even harder to qualify for a traditional mortgage. Proposals include new limits on loan-to-income ratios, GDS and TDS limits for uninsured borrowers, and updates to the mortgage stress test. OSFI, Canada’s banking regulator, sought feedback from mortgage industry participants beginning in mid-January, and the comment period for the proposals closed on April 14. According to OSFI, feedback from this consultation process will inform proposed revisions to B-20 guidelines, which will be issued for public consultation in the form of a draft guideline at a future date.

If these changes come to pass, it will become more difficult for your borrowers to qualify for a traditional mortgage. Remember that CMI is here to help by ensuring that there’s a fair and flexible alternative solution available.