IMPORTANT NEW INFORMATION REGARDING MORTGAGES
Federal Finance Minister Jim Flaherty announced three new rule changes connected to government-backed insured mortgages Tuesday morning, saying the government is “taking proactive, prudent and cautious steps” to prevent a housing bubble.
- The biggest change is the requirement that all borrowers be qualified at a five-year fixed mortgage rate even if they choose a shorter-term, lower-interest product.
- The government also lowered the maximum amount Canadians can withdraw in refinancing their mortgages from 95 to 90 per cent
- introduced a minimum down payment of 20 per cent for government-backed mortgage insurance on non-owner occupied properties purchased “for speculation.”
The rule changes are set to come into effect on April 19.
What does this mean for you? If you have been on the fence about whether to buy an investment property, now is the time to take action. After April 19, it will require $80,000 to buy a $400,000 rental property instead of $20,000 (O.A.C).
Call or email now to find out if you can take advantage of the current lending environment before it changes.
bgavin@mbnltd.com www.mbnmortgage.com
