Mortgage Update
The federal government recently released its budget, and I wanted to share a few proposals that could affect your mortgage options if you’re planning to buy a home or renew in the coming months.
Some proposals could give buyers more lenders to choose from, while others could make it easier to compare mortgage offers. Overall, we’re excited to see the government working to help Canadians achieve homeownership and have better mortgage options. Here’s a quick overview of what could change.
More options for some buyers
Even with a 20% down payment, some lenders use mortgage default insurance to fund a loan. Ottawa proposes raising the home price cap for this type of insurance from $1 million to $1.5 million.
That could give buyers in this price range more lenders to choose from, increasing competition and potentially leading to better rates and options.
No start date has been announced, so if you’re house hunting now, I can help you compare the options available today.
A longer repayment period for some mortgages
Ottawa also proposes allowing up to 30 years to repay mortgages insured under these optional mortgage default insurance rules when at least one borrower is a first-time buyer or the home is newly built.
Again, this added competition could mean better rates and options.
If you’re weighing 25 versus 30 years, I can show you how each option may affect your monthly payment, balance at renewal and total interest cost.
More information when comparing offers
Ottawa wants the Bank of Canada to publish more data on insured mortgage rates and plans to consult on how to make prepayment penalties clearer.
If you’re comparing offers, I can help you look beyond the rate to understand the cost of breaking a mortgage early and whether you can take it with you if you move.
Income verification
A proposed pilot would allow participating lenders and mortgage insurers to verify income through the Canada Revenue Agency, which helps combat mortgage fraud and support overall affordability.
A few other proposals to watchNew triplexes and fourplexes: New insurance rules could expand financing options for eligible newly built properties, including properties where all units will be rented. The rules apply to insurance applications submitted by lenders on or after February 1, 2027. Income verification: A proposed pilot would allow participating lenders and mortgage insurers to verify income through the Canada Revenue Agency. Foreign-buyer ban: Ottawa proposes extending the federal ban on foreign purchases of existing homes to January 1, 2029, with an exemption for newly built homes subject to the final rules. |
What this means for you
These are proposals, and final rules, eligibility requirements and timing may change.
If you’re thinking about buying, have a renewal coming up or simply want to know if any of this applies to you and your personal situation, reply to this email.