The new Bank of Canada benchmark qualification rate is 5.25%, up from the previous 4.79%. Lenders must qualify borrowers at the higher of their contract rate plus 2% or this new benchmark rate.
According to Dalia Barsoum, the impact is relatively small compared to the 2018 changes. Qualification power is expected to drop by approximately 4 to 4.5 percent.
This advanced strategy involves converting a secured line of credit into a mortgage. Because banks use 3% of the outstanding LOC balance in their calculations—often more than double the actual interest-only payment—converting it to a mortgage lowers the payment used for qualification.
You can work with lenders that use an opinion of market rents rather than actual rents, declare more income if you are self-employed, or add a co-applicant to the mortgage application.
Yes. The changes apply to all mortgages across Canada—both insured and conventional—regardless of the amount of down payment you are putting into the deal.
