Canada's New Mortgage Rules

Real Estate Agent with REMAX House of Real Estate


Last month, the government of Canada changed the way you buy a home. New mortgage rules, designed to protect the market and buyers from the shock of changing interest rates, have left some buyers confused. Here, we offer a breakdown of what these changes mean and how they affect you when buying your home.

Almost all buyers must now qualify for a 5-year term, fixed-rate mortgage at their bank’s posted interest rate, but can still chose any mortgage term. Buyers who are looking for a variable-rate mortgage, which is tied to the Bank of Canada’s rate, can still do so. They MUST, however, show that they can service a loan at the higher 5-year term rate. As before, principal home owners must have at least a 5% down payment and can chose a maximum amortization rate of 35 years.

Buyers looking to enter into the investment market also face more stringent rules. Those buyers looking to invest in an income property must have a minimum 20% down payment. In the past, such buyers could obtain a mortgage with 15% down. There is one exception to this rule. Buyers looking to purchase homes that will serve as both their residence and an investment property (such as duplex units) can still qualify with just 5% down.

Keep in mind that the new regulations are not insurmountable obstacles. “They may seem strict,” says Treena Rogers, Mortgage Associate at Jencor Mortgage Corp. here in Calgary, “but they are there to protect you.” Her advice to potential buyers is to read the new rules, think clearly and speak to a mortgage professional. “People are afraid they can’t qualify,” says Treena, “but knowing the rules and talking to a broker will make everything clear."

Ross PAVL Marketing Group

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Ross PAVL & Associates | Giving Your Home the Selling Advantage
RE/MAX House of Real Estate
direct: 403.800.6056 | fax: 888.612.4797 | |


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Jason Rose
123 ConEd LLC -- Michigan real estate continuing education - Farmington Hills, MI

Welcome to ActiveRain, Ross, and congratulations on your first post! This is a great place with lots of knowledgeable people who share tons of helpful information.  I hope you'll enjoy this great website as much as I do.

-- Jason

Jun 16, 2010 08:54 AM #1
Steve and Jan Bachman
RE/MAX Gateway, Reston, Herndon, Ashburn, Sterling, Fairfax - Herndon, VA
Realtors - Northern Virginia

Great first three posts Ross. Welcome to Active Rain by the way... have fun in the game.

We joined last November and have found that the Rainmaker outside blog combined with Localism have worked well for us…. getting us better page placement on Google searches within neighborhoods. Worth checking out. 

It is also a good idea to use a lot of pictures in your post from the area you cover to get and hold people's attention...they shy away from reading blocks of text.

A side benefit of AR is learning from other folks’s social media creativity and making friends for future referrals. Here is a good place to start: Learning  to use Active Rain  

Have great success this year,

Steve and Jan




Jun 19, 2010 01:17 AM #2
Sergio Rebollo Jr.
Real Estate TeamMates - Miami, FL

Welcome to ActiveRain. This is a great community to network with others as well a great place to learn from other's experiences and knowledge. I've enjoyed it; I hope you enjoy it as well.

Jun 23, 2010 03:16 PM #3
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