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Latest News
Honouring the latest Mortgage Hall of Fame inductees Oct 20th
After a pandemic-induced hiatus, hundreds of mortgage professionals gathered at the Vancouver Convention Centre Monday night to honour the latest inductees into the Canadian Mortgage Hall of Fame..... More »
Fixed mortgage rates are rising. What’s the deal? + MORE Apr 21st
As variable-rate mortgage holders eagerly anticipate the Bank of Canada's first rate cut, fixed rates are heading in the other direction: up..... More »
FSRA CEO Mark White to step down for new position as Chair of Ontario Energy Board Jul 5th
The head of Ontario's mortgage broker regulator, Mark White, has confirmed he will be stepping down from his role as CEO later this month..... More »
Community Trust at 50: A golden anniversary built on broker partnerships + MORE Oct 19th
Reflecting on five decades of alternative lending, national growth, and an unwavering commitment to the Canadian mortgage broker community..... More »
Many mortgage holders have little room for higher payments: MPC + MORE Jun 26th
New consumer research finds recent buyers and newcomers are facing sharper affordability pressure, even as confidence in homeownership remains resilient..... More »
Can Canadians Stand Up to a Tougher Stress Test?
– canadamortgagenews.ca
Buying a home in Canada just got a lot more stressful. Recently, the OSFI’s stress test has become substantially more challenging to pass – and hardly anyone noticed. The qualifying rate is now as high as 6.00%. If it wasn’t hard enough to purchase a home in Canada, now it’s even harder. And if rates keep going up as they’re predicted to, it’s not going to get any easier.
What Is a Stress Test?
To ensure homeowners can withstand future rate changes, federally regulated mortgage lenders are required to administer a stress test. This stress test uses what’s called a “qualifying rate” to ensure that you can continue to afford your home in the event rates increase in the future. The qualifying rate will always be much higher than your actual rate. Right now, it’s whichever is higher between 5.25%, or your contract rate + 2.00%. For example, if you found a fixed rate mortgage of 3.69%, you would be stress tested at 5.69%.
Why Does This Matter?
The last time the OSFI raised the qualifying rate was about a year ago…
