OSFI, our Federal regulator, has announced in efforts to “cool” the market they would like the 6 big banks to increase the qualifying rate from the current 4.79 to a minimum of 5.25 or 200 basis point above the “contract rate”.
Read the full release here from our economist Dr. Sherry Cooper.
This is an increase of 46 basis points and will DECREASE your purchasing power by approx. 5%, unless you complete funding before May 24th.
If you or a loved one have a pre-approval or purchase of a pre-sale in place, we recommend that you review your qualifications to ensure you can still purchase as intended.
Who this impacts:
- Yes it’s true, this impacts the middle class the most and those who put more money down. This does not feel like a solution to fix the intended problem of cooling the market, as it doesn’t address the supply of real estate in deficit, which requires regional solutions.
- All cash offers being submitted that are not really ALL cash and require financing or the sale of a property.
The fact that during a global pandemic, the default rates on mortgages went down, showing under pressure Canadians worked even harder and paid their mortgages!
There will be much more clarity in upcoming weeks, maybe even a shift or reduction in this consideration, however its crucial to be prepared so you or a loved one don’t get caught up in this timing. We are here to advocate for and assist you with the best mortgage to build and protect your wealth.
If you or a loved one has a question on reviewing their existing mortgage that is approaching renewal, accessing equity to pay off high interest debt, or planning a purchase, please reply to this email or call us at 604-802-3983. We are here to help guide you through every market transition.
Angela Calla is a 16-year award-winning woman of influence and mortgage expert. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. She educates and empowers individuals on “The Mortgage Show”, and is the best selling author of The Mortgage Code where all proceeds are donated to the YWCA.
Angela is a magazine contributor, speaker, and recently collaborated to publish her third book, Pursuit:365. In August of 2020, Angela surpassed $1 Billion dollars in funded personal mortgage volume at the young age of 37 and was recently awarded the 2020 Business Leader of the Year Award. Angela leads by example with passion and conviction, known as an industry expert and go-to source for media and publishers across the Country.
For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at firstname.lastname@example.org or 604-802-3983.