Oh The Mortgage Rules They Are a-Changin’
As of July 9th, 2012, a number of rule changes are being implemented in the Canadian mortgage market.
The changes to the mortgage rules in the Canadian market include, but are not limited to:
- The reduction of the maximum amortization period to 25 years from 30 years on CMHC insured (otherwise known as “high-ratio”) mortgages.
- Lowering of the maximum amount Canadians can borrow when refinancing against their home to 80% from 85% of the value of their homes.
- Changing the the maximum gross debt service (GDS) ratio at 39% and the maximum total debt service (TDS) ratio at 44%.
- Homes with a purchase price of more than $1 million will no longer be insured by the CMHC; requiring buyers to have a 20% down payment to make such a purchase.
As always, if you have any questions regarding the mortgage rule changes taking place in Canada, do not hesitate to contact your local mortgage broker with your questions or comments.
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