Harder Rules For Mortgage Financing Jan 1, 2018
  
The Office of the Superintendent of Financials Institutions is requiring all mortgages insured or not insured, to qualify at the Canadian bench mark or 2% higher than the contract rate.
What does this mean?
You're going to lose around 20% of your purchasing power starting in January.
Is there a way around this?
No (well maybe, keep reading...)
Are there other options?
Yes. Provincially regulated lenders such as credit unions do not have to follow these rules. It only applies to federally regulated lenders such as big banks or mono line lenders. However, there are other issues you have to deal instead.
What can you do?
If you want to refinance or add a line of credit, do it now. If you want to buy in 2018, buy now. I mean now, as everyone is extremely busy and refinances are taking double and even triple the time longer to complete.
What is the long run ramifications of this?
More people will require mortgage planning to qualify.
10 years ago, you were able to do 0% down, self employed stated income mortgages. If you had a pulse you would qualify.
Today, they need detailed financials to qualify with minimal exceptions allowed. Many clients are shocked to see how much documentation is required and the evidence that must be produced to get what was previously thought of as a "simple" mortgage.
With all the restrictions and requirements put in place today, we really have no idea what else is coming in the years ahead. Even if you are approaching retirement and have substantial equity in your home, you still have to meet the ever-tighter credit rules.
As for that rate on the billboard, that's a thing of the past too!
How would this affect real estate prices? Curious? Want to know your options?
Call me @ 250-565-4969 and we can have a quick chat.
PS: If you are considering a home purchase or a refinance do not delay, CALL ME NOW! Wait times are growing longer each week, however applications submitted prior to December 31st will be grandfathered.
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