Ottawa changing key mortgage rules
Posted Jan 17, 2011 12:23 pm.
This article is more than 5 years old.
With warnings that Canadians are racking up too much debt, Finance Minister Jim Flaherty is changing three key mortgage rules.
Ottawa is lowering the maximum amount you can borrow to refinance a mortgage, reducing amortization periods to 30 years and withdrawing its insurance backing on lines of credit secured on homes.
The International Monetary Fund recently labelled household debt the number-one risk to the Canadian Economy.
The Vice President and Deputy Chief Economist at Scotiabank believes the changes will help some people deal with their debt bulge.
Aron Gampell tells 660News the changes which are to take effect on March 18th, will make it tougher to buy a home or borrow against it, but they won’t adversely hurt the real estate market.
The Canadian Association of Accredited Mortgage Professionals predicts there may be a rush of buyers into the housing market before the changes take effect.
The Bank of Montreal’s Doug Porter says the measures are the equivalent of raising interest rates by about half a percentage point, but really only target a small percentage of homeowners.
