Michael Kinar

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Email: michael@expertadvisorrealty.com

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Upcoming Mortgage Changes

 

Information summarized from CREA June 21st media release.

 

Yesterday morning, the Minister of Finance announced changes to the standards governing government-backed insured mortgages:

 

  • the maximum amortization period was reduced from 30 years to 25 years;
  • the maximum amount Canadians can withdraw in refinancing their mortgages was lowered to 80 per cent from 85 per cent of the value of their homes;
  • the maximum gross debt service ratio was fixed at 39 per cent and the maximum total debt service ratio at 44 per cent; and
  •  the availability of government-backed insured mortgages was limited to homes with a purchase price of less than $1 million.

 

CREA has continually stressed the need to avoid changing the minimum down payment. Today’s announcement confirms Canadians will continue to be able to purchase a home with five percent down.


The changes announced today will come into effect on July 9, 2012. Details of the announcement can be found 
here .

 

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