Federal Government Changes Mortgage Rules

February 20, 2010

February 16, 2010 -- The federal government has announced changes to the rules for government-backed insured mortgages (less than 20 percent down payment) as follows:

  • All borrowers will be required to meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter terms.
  • Reduced maximum amount that can be withdrawn in refinancing a government-backed insured mortgage to 90 per cent from 95 per cent of the value of the home.
  • Require a minimum down payment of 20 per cent for government-backed mortgage insurance on non-owner occupied properties purchased for speculation. Borrowers purchasing owner-occupied residential properties will still be able to access government-backed mortgage insurance with a 5 per cent down payment.

    Additional detail is available here.

 


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