It appears at least one of Canada's big banks is struggling to adapt its mortgage lending to increased oversight by the Office of the Superintendant of Financial Institutions (OSFI). I had the chance to speak with a representative from one of the big banks. He indicated OSFI is conducting audits on the banks mortgage book of business and deemed 80% of them were done on an "exception basis". Examples of exceptions might involve income, beacon or credit score, time at an employer etc. He stressed that these were conventional mortgages ie) the borrower had at least 20% home equity. The bank was comfortable with the risk but OSFI wasn't.
What does this mean on the street? The scrutiny on new mortgage lending is increasing rapidly. OSFI wants everything done "by the book". This means fewer borrowers will qualify for a mortgage. Fewer borrowers means fewer buyers and fewer buyers will result in lower real estate sale prices for Kitchener Waterloo home sellers.
The new mortgage rules impact everyone from first time buyers and sellers to existing Kitchener Waterloo homeowners. If you'd like to discuss how the changes affect you, feel free to call or email 519-505-4488 firstname.lastname@example.org.
Century 21 Home Realty Inc. Brokerage
"Delivering results since 1989"