Karen Tsao | 604-422-0855

Federal Government Changes to Mortgage Lending

For the fourth time in as many years, the Federal Government has announced action to restrict mortgage credit. The new measures include:

  • The maximum amortization on a prime mortgage will be reduced from 30 to 25 years.
  • Mortgage insurance will not be provided for properties valued over $1 million.
  • Refinancing has been lowered from a maximum of 85% loan-to-value to a maximum of 80% loan-to-value.
  • The maximum gross debt service (GDS) and total debt service (TDS) will be limited to a maximum of 39% and 44% respectively. Currently, GDS does not apply to qualified borrowers with credit scores over 680.

These measures will take effect July 9, 2012.


For more information, here’s the government’s Q and A document: www.fin.gc.ca/n12/data/12-070_2-eng.asp

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