New Mortgage Rules Announced Effective July 9 2012


Yesterday, the federal government announced it is moving to tighten the mortgage rules again. If you are thinking about buying or selling this could be very important to you. If you have any questions please don’t hesitate to call or e-mail me anytime.

Please read the e-mail sent from Mortgage Broker Chantal Chapman regarding the changes and implications.

The changes are as follows:

1.      Reduce amortizations to 25 years

2.     Limit the amount that homes can be refinanced to 80% of it’s value

3.     Fix the maximum gross debt service ratio at 39% and the maximum total debt service ratio at 44%

4.      No more CMHC insured mortgages over $1,000,000

These changes will take place July 9th which is a very short period of time.  We have numerous clients who are purchasing and considering refinancing that will be affected by these changes. 

For clients purchasing homes, or considering purchasing, this will reduce the amount that purchasers will qualify for. 

Being preapproved for a 30 year amortization doesn’t provide any additional security.  Preapproved clients will need to have a firm accepted offer and financing firmly approved on a property with a 30 year amortization prior to the rule date changes.  This would have to take place before July 9th, 2012.

In recent months, we have had many of our clients refinance their mortgages for longer term stability in the interest rate and to keep their long term payments low.  We currently have 5 year terms available at 3.09% and 10 year terms available at 3.89%.  Many of our clients have been moving into 10 year terms at the 3.89% with an accelerated payment plan to help them get their mortgages paid down faster.  30 year amortizations will still be available until July 9th.

Now is a very good time to contact us to review your mortgage and see if you should be considering refinancing your mortgage.  We are in the office today and waiting for your calls.

Please call Chantel at 604-862-8526 or 604-281-HOME to discuss your mortgage today!

For the full article from the Canadian Department of Finance please click here.



Warm Regard,


Morgan DuVernet

Century 21 In Town Realty



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