Photo via Jonathan Hayward, the Canadian Press

You've likely heard that the Office of the Superintendent of Financial Institutions (OSFI) announced new mortgage qualification rules that come into effect on January 1, 2018. 

These changes are being extended to all of the new borrowers purchasing and have more than 20% as a down payment (therefore taking out an uninsured mortgage). As well, homeowners who have more than 20% equity in their home who are looking to refinance will be impacted. 

What does it mean for home buyers and owners?

The minimum qualifying rate for uninsured mortgages will now required to be the greater of the five-year benchmark rate (by the Bank of Canada) or the contract mortgage rate +2%. Simply put, its greatest impact will be how much you can qualify to borrow.

Who is exempt from these new qualification rules?

Anyone who is renewing their current mortgage, and those purchasing with less than a 20% down payment on an insured mortgage. 

What about getting pre-approved?

If your final approval happens after January 1st of 2018 -> most likely, it will be subject to the new rules. A "pre-approval" is not the same as the "final approval".

Unfortunately, this means some buyers might need to reconsider their budget and strategy with their trusted advisor - keeping the new mortgage restrictions in consideration. 

Talk to an expert 

Wonder how much house you'll be able to afford to buy? Get in touch today - we're here to help you plan your successful Real Estate investments for the long term. 

Please be sure to give us a call at (604) 241-7653 with your questions, or email 

We're here to help!

Michael Cowling & Associates