Here is the latest annoucement by the federal government!
The federal government today announced three mortgage financing changes designed to address concerns about increasing levels of household debt. A link to the government announcement is here and a Globe and Mail story on the changes is here. In short, the changes are:
The government will reduce the maximum mortgage amortization period from 35 to 30 years.
The maximum amount of the value of a home that can be re-financed will drop from 90 per cent to 85 per cent.
Government insurance will no longer be available to financial institutions wishing to insure home equity lines of credit.
Please note that the government did not increase the minimum downpayment, which was under consideration.
Together, these three measures are designed to ensure homebuyers invest responsibly in home ownership and don't risk their financial security by buying too much home for their income or the country's economic circumstance.