We now have more concrete information going forward on conventional mortgages or more than 20% downpayment of equity in your home. Please read the revised regulatory update . In short you have up until November 30th to qualify on a 5 year fixed low rate mortgage, amortized over 30 years. As of November 30th all mortgages will be underwritten under the Stress Test Rate of 4.64% over 25 year amortization, regardless of which term and low rate you may end up with.
If you are thinking of consolidating debt, renovating, buying rentals, cottage, Second home, moving up, or taking equity out for any other reason, you may want to contact us to do a quick STRESS TEST to see if there will be any issues and if so, maybe take advantage of it before November 30th. The other change is that you do not have to close until May 1, 2017. For example, if you applied for a refinance and or purchase before November 30th, we could qualify you at 2.49% and close by May 1, 2017.
There will be another update as we get closer to November 30th, 2016. We will be lobbying the Government as these changes could affect consumers ability to shop competitively for a mortgage and give much greater control to the Banks . Did you know that the only Institutions that were aware of these changes were the Big 5 banks and they are also the Financial Institutions that control the Bank of Canada qualifying rate.
Based on history and the many changes I have seen, I am sure this will work out for everyone in the end.
To take the STRESS TEST please email firstname.lastname@example.org or call 519-743-4365 to speak to one of our Kitchener-Waterloo brokers, Paul, Brent, Chelsea or Jennifer.