New Mortgage Rules

This morning, Federal Finance Minister Jim Flaherty announced prudent changes to mortgage insurance rules intended to come into force on April 19, 2010:

1. All borrowers must meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term;

2. The maximum amount one can withdraw in refinancing their mortgage will be reduced to 90% from the current 95% of the value of one's home;

3. Non-owner occupied properties will require a minimum down payment of 20%. There were no changes to down payment requirements or length of amortizations for owner-occupied residences.

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