Christine Buemann Mortgage Broker

As the dust is settling from the last set of rule changes in October, a more significant set of changes took effect yesterday. The overall impact that they will have is still being speculated by economists all over the country. Every lender has been scrambling to put together new processes and strategies for implementing their new guidelines. Lenders have been changing rates / policies daily so please bear in mind that their turnaround times will likely be a little slower with all banks for the short term. Here are some of the most significant changes we have seen over the last few days: Some lenders have discontinued 30/35 year amortizations, refinances and rental purchases altogether Most lenders have started charging a higher rate for refinances, 30 year amortizations and rental purchases Some lenders have started doing risk based pricing where they require minimum credit scores to have access to certain products Most lenders are cha...

As I have previously mentioned, the new OSFI (Office of the Superintendent of Financial Institutions Canada) changes took effect for most lenders on November 1 st . Here are a few examples of how the changes could affect you: ·          Qualifying rate is going to be used for all variable rate mortgages and terms less than 5 years (previously, some lenders would use a lower rate such as the 3 year fixed rate to qualify conventional mortgages) o    Let’s say you have an annual salary of $50,000 and you are going to get a variable rate, conventional* mortgage. If they could have previously qualified you at a 3 year rate, you would have qualified for approximately $297,000 . Now that they will be using the qualifying rate, you will only qualify for approximately $228,000 * ·          Heat component will be set according to property size (previously most lenders would use $75-$100 a month for he...

As of today, the new mortgage rules for insured mortgages are officially in effect. The major change that most people have been discussing is the shortening in maximum amortization from 30 years to 25 years. How will this affect people who were pre-approved under the old rules, but now will have to abide by the new ones? Here are some approximate numbers for the following mortgage amounts over a 5 year term at a fixed rate of 3.19%: $200,000 -payment increase of $100 a month -total interest savings of $510 over a 5 year term -total reduction of principle by $6,790 over the term $250,000 -payment increase of $130 a month -total interest savings of $640 over the term -total reduction of principle by $8,480 over the term $300,000 -payment increase of $150 a month -total interest savings of $770 over the term -total reduction of principle by $10,180 over the term Please also keep in mind that an increase in monthly payment also means that you will qualify for slightly l...