Changes in lending since 2008


Here's an interesting journal to pass along in regards to lending rule changes in the past 4 years.

 

Mortgage rules from the past 4 years

 

For your information the following are the changes in mortgage rules over the past 4 years including all of 2012′s changes:

 

2012

 

    LOC (line of credit) reduction to a maximum of 65% LTV (loan to value)

    Stated income for BFS (business for self) programs require 35% down now

    Cash-back no longer accepted as down payment

    Qualifying rates on conventional lending to now use the 5 year benchmark rate for terms of less than 5 years and VRM’s (variable rate mortgages)

    30 year amortization gone for high ratio mortgages, now 25 years

    No mortgage insurance (CMHC, etc) for properties over 1 million

    Lower maximum LTV (loan to value) for refinances. Was 85%, now 80%

    GDS (gross debt servicing) reduced from 44% to 39%

    Rental property down payment requirement is now 35% from 20% with many lenders

 

2011

 

    35 year amortization gone for high ratio mortgages, now 30 years

    Lower maximum LTV (loan to value) for refinances. Was 90%, now 85%

    Elimination of government insurance on LOC’s (line of credits)

 

2010

 

    Qualifying rates on high ratio lending to now use the 5 year benchmark rate for terms of less than 5 years and VRM’s (variable rate mortgages)

    Lower maximum LTV (loan to value) for refinances. Was 95%, now 90%

    Rental property down payment requirement is now 20% from 5%

 

2008

 

    Minimum down payment changed from 0% to 5%

    Minimum beacon score of 620 required for high ratio lending

    New loan documentation requirement standards

    45% maximum TDS ratio

    40 year amortization gone for high ratio mortgages, now 35 years

 

 Marc Gobeil | Manager, Mobile Mortgage Specialist | TD Canada Trust

North Okanagan

PH – 250 540 3100 | FAX – 888 518 6540

marc.gobeil@td.com

Follow me on Twitter: @TDMarcG

 

Mike Sandstra

Mike Sandstra

REALTORĀ®
CENTURY 21 Executives Realty Ltd.
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