Starting on January 1, 2018, the Office of the Superintendent of Financial Institutions (OSFI) set a new minimum qualifying rate, or “stress test” for all prospective home buyers, even those with a down payment of over 20%.
Before the new rule, only buyers that had a down payment of less than 20% had to make sure they could pass a stress test. Now it doesn’t matter how much money you save for a down payment, if you don’t pass the new stress test, the bank will not give you a mortgage.
Under the new mortgage stress test, potential home buyers need to qualify for a mortgage at a rate that is either 2% higher than the mortgage rate they qualified for, or the Bank of Canada’s five-year benchmark rate. For most, that will mean qualifying for a home…
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