Regulator says homebuyers won’t face tougher mortgage stress test – National

Federal banking regulator is keeping the interest rate used in a key stress test for the uninsured Mortgage waiting.

The Office of the Directors of Financial Institutions says the minimum qualifying rate for uninsured mortgages will still be two percentage points higher than the policy plus mortgage rate, or 5.25 percent.

Low interest rates have helped Canadians borrow money to buy homes, but also burden them with large mortgages as home prices skyrocket.

Read more:

New mortgage stress test rules coming June 1

The regulator said in an environment characterized by rising household debt and low interest rates, it was essential that lenders check borrowers to make sure they could repay their loans within the short term. more unfavorable conditions.

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OSFI changed its stress test rate earlier this year and committed to review and announce it at least every December.

Uninsured mortgages are residential mortgages with a down payment of at least 20%. The Treasury Department sets a minimum qualifying rate for insured mortgages.

© 2021 Canadian Press Regulator says homebuyers won’t face tougher mortgage stress test – National

Bobby Allyn

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