New Mortgage Rules Taking Effect December 15, 2024

Effective December 15, 2024, the Canadian government is implementing significant changes to mortgage regulations aimed at enhancing housing affordability and accessibility. These reforms are designed to assist current and first-time homebuyers and stimulate new housing construction.

Key Changes:

No Stress Test for Switching Lenders at Renewal

Homeowners with insured mortgages will no longer need to pass a stress test or requalify financially when switching lenders at renewal. This change enhances competition, allowing borrowers to shop for better rates or terms without financial requalification barriers.

Key Benefits:

• More Options: Easier to switch lenders and negotiate better terms.
• Flexibility: Beneficial for those whose financial situation has changed since their initial mortgage approval.
• Savings: Promotes competitive offers among lenders, potentially lowering costs.

Considerations:

While this rule removes barriers, switching lenders may still involve fees (e.g., legal, appraisal). Consult a mortgage professional to evaluate options and ensure the switch aligns with your financial goals.

Increased Price Cap for Insured Mortgages:

• The maximum property value eligible for government-backed mortgage insurance will rise from $1 million to $1.5 million. This adjustment allows buyers in higher-priced markets to qualify for insured mortgages with down payments of less than 20%.

Additional Measures:

Extended Amortization Periods:

• Eligibility for 30-year amortization periods is expanding to include all first-time homebuyers and purchasers of new builds. This extension aims to reduce monthly mortgage payments, making homeownership more attainable.

First-Time Buyers:

• The increased insured mortgage cap and extended amortization periods provide greater flexibility, enabling access to homes in higher-priced markets with more manageable monthly payments.

Buyers of New Builds:

• The reforms encourage the purchase of newly constructed homes, supporting the construction industry and addressing housing shortages.

Considerations:

Affordability:

• While these measures aim to improve affordability, extending amortization periods may result in higher overall interest payments over the loan's lifetime.

Market Impact:

• Experts suggest that increased borrowing capacity could lead to higher home prices, potentially offsetting affordability gains.

If you need guidance to renew or refinance your mortgage, and want professional guidance on how to make the best decision based on your situation, we are here to help you.  

Click the link below to start the conversation!  

Mortgage Partner

Matthew Shantz is a Mortgage Broker and Team Leader with Dominion Lending Centres FC Funding. He brings over 15 years of experience in mortgages, having worked with both the Mortgage Lenders and as a Mortgage Broker.

He currently leads a team of 30 brokers and agents who are dedicated to providing their clients with the best solutions, products, and services. He is highly focused on financial education and literacy.

Whether you are purchasing your first home, renewing your existing mortgage, refinancing to consolidate debts or access your equity, or building an investment portfolio, Matthew and his team are happy to support you no matter where you are on your journey.

­Contact Matthew's Team­

Disclaimer: Millennial Wealth Advisors does not receive any fees or compensation from referrals to Matthew Shantz's team. Our recommendations are based solely on providing value and trusted expertise to our clients.

Ep.003: Navigating the Mortgage Landscape in Canada with Matthew Shantz

In this episode of the Millennial Money Canada podcast, we, Guillaume Girard and Sam Lichtman, welcome mortgage broker Matthew Shantz to discuss the current mortgage landscape in Canada.

We explore various topics, including the importance of financial literacy, the impact of interest rates on the housing market, and strategies for self-employed individuals seeking mortgages. Matthew shares insights on reverse mortgages and the benefits of multi-generational living, emphasizing the need for proactive financial planning.

Our conversation highlights the importance of understanding mortgage insurance and preparing for upcoming mortgage renewals, providing you with valuable information to navigate your financial future.

Find us on Spotify, Apple or Youtube under the name "Millennial Money Canada Podcast"

­Listen Now­

­Get in Touch

Guillaume Girard, CFA CFP | Sam Lichtman, CFP

‍Millen Wealth Advisors ­

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