What Is The Mortgage Stress Test
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In January 2018 the Government of Canada introduced a new Stress Test to be used when qualifying for a mortgage.
Prior to January 2018 those in need of a Mortgage, with at least 20 Percent Down Payment, needed to qualify at the Contract Rate, or the interest rate at which they would be paying for their new mortgage.
However, under the new rules borrowers now need to qualify at either the Bank of Canada's Benchmark Rate (currently 4.99*), or the Contract Rate + 2 Percent.
The result of the new policy is to drastically reduce the buying power of Canadian buyers. For example, if under the old rules you qualified for a mortgage with an interest rate of 3.04 percent, you will now need to qualify at a rate of 5.04 percent, significantly reducing the amount of mortgage that you are able to obtain.
The Good News? I Can Help!!
I have access to multiple Mortgage Lenders which are not subject to the stress test, so you can still qualify at the Contract Rate, maintaining the purchasing power you held prior to imposition of the Stress Test. Access to these Mortgage Lenders have enabled me to help multiple clients purchase homes for which they otherwise would not have qualified
Please Contact me by Phone, Call or Text at (519)860-2102, or use the form below to discuss how I can help!