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7 Jul

July 2012 – Departement of Finance Canada Mortgage Changes

General

Posted by: Kimberly and Cindy Walker

Please be advised, effective July 9, 2012, the following changes mandated by the Department of Finance – Canada will be implemented:

Maximum Amortization Available for Default Insured Mortgages

  • The maximum amortization for      default insured mortgages will be reduced to 25 years (previously 30      years)

Maximum Amortization Available for Uninsured Mortgages

  • The maximum amortization for      uninsured mortgages remains 30 years

Maximum Purchase Price for Default Insured Mortgages

  • In order to qualify for a      default insured mortgage, the purchase price must be less than $1 Million

Maximum Loan-to-Value Ratio (LVR) for Refinances

  • The maximum LVR for the      refinance of an owner occupied property will be reduced to 80% (previously      85%)

Pre-approvals for Default Insured Mortgages

  • A mortgage pre-approval      without an agreement of purchase and sale is not sufficient to qualify for      a 30-year amortization. In order to qualify for a 30 year      amortization, the purchase and sale agreement must be dated before July 9,      2012 and the mortgage insurance application submitted before July 9, 2012.