New Mortgage Rules

After Nov. 30, 2016, Canadian residential mortgages can be put into two big categories:

Insurable versus Un-Insurable mortgage:

1). For insured or insurable mortgages, the applications have to meet the following parameters:

  1. Purchase of owner occupied properties or 2-4 unit rental properties
  2. Maximum purchase price of 1 million
  3. Maximum amortization of 25 years
  4. Application has to be qualified on Bank of Canada’s Benchmark rate

2). Anything outside that box are Un-insurable mortgages, which includes:

  1. All Refinance or Equity Take Out applications;
  2. Where purchase price is more than 1 million
  3. Borrowers require more than 25 years amortization
  4. The subject property is a single unit rental property
  5. Borrowers requires lower contract rate to be qualified (applicable to 5-year fixed term or longer)

Most lenders price their products based on the risks. In return, the Un-insurable mortgages will bear a higher interest rate when comparing to Insurable mortgages. That means you will be paying higher interest rates if you are:

  1. Refinancing
  2. Purchasing more than 1 million dollars property
  3. Requiring 30 years or longer amortization
  4. Purchasing a single unit rental property
  5. Requiring lower qulification rate

Most of our website rates are based on the insurable mortgages. Please contact us to see what is your suitable rate.