OSFI Will Be Introducing a New “Stress Test” for Uninsured Mortgages (greater than 20% down payment) Effective January 1, 2018.

The Office of the Superintendent of Financial Institutions (OSFI) released new guidelines for the mortgage industry, which include a “stress test” for uninsured mortgages.

Home buyers with 20% or greater down payments will need to qualify for their mortgages using the higher of the average 5-year posted rate (currently 4.89%) or 2.00% higher than their actual mortgage rate. Initial calculations show that this will reduce purchasing power by roughly 16%.

Buyers with a $145,000 gross annual income can currently qualify for a $1,000,000 purchase price with 20% down.  Under the new rules,  with the same income,  they will only qualify for a $840,000 purchase price.

The new guidelines will come into effect on January 1, 2018.

For more details: 
CBC News Online Article by Pete Evans
OSFI News Release





This entry was posted in Buying and Selling, Home Finance.