What Canadian home buyers need to know NOW about the upcoming changes to Mortgage rules
As of January 1, 2018, Canadian homebuyers will have to meet stiffer requirements in order to qualify for a mortgage with a federally regulated mortgage lender.
Why are the Mortgage Rules changing?
Our very own Kent Browne, Owner and Broker at Royal LePage Team Realty, sat down with Mortgage Broker York Polk of Mortgage Alliance to discuss all these changes in order to help you, our clients, understand how they may affect you.
Changes that came into effect November 30, 2016 and still apply:
Changes starting January 1, 2018
* Stress testing is a best practice risk management tool. Stress tests are not predictions or forecasts, they involve searching out extreme “what if” scenarios that have a very remote chance of happening, and planning for them.
Diligent stress testing is an essential part of CMHC’s risk management program and allows CMHC to evaluate its capital levels against multiple scenarios. Effectively, they confirm if CMHC’s capital holdings are sufficient for even the most extreme scenarios.
Stress tests are used by financial institutions to gauge how their business would fare under extremely difficult conditions. They provide a formalized mechanism for companies to look at risks and to assess the impact of the different extreme events. This information is from the CMCH article found here.
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