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Pssst... I have something to share.....OSFI Made It Official!

I have some interesting news to share. From the blog post I wrote on May 1st, 2013 it seems OSFI has made it official legislation, I guess it was May 1st, 2013 (good call on my blog post).

Here goes the new info that is currently being followed by all lenders and will affect qualification for mortgages.

 1) Payment Caculations: Have to use 3% of the balance, on all Unsecured Credit (so interest only payments on UnSecured Lines of Credit are inconsequential - as the 3% of the balance must be used)
 
2) Market Rents can no longer be used; a lease agreement has to be in place even it is the primary property

 3) Alimony/Child Support payments being paid are calculated as liabilities (not as prior subtracted from income)

 4) Deficit on rentals on T1s are now also calculated as a liability ( not subtracted from income) 

Also what I am hearing is the Finance Minister is going to try to change the amortization allotments for Conventional Mortgages, which currently can be up to 35 years depending on the lender, down to what it is for the Insured Mortgages, which is 25 years. Personally my thoughts on the matter are all mortgages should be 25 years, not the 30-40 years that we had previously. Yes it makes it easier to qualify, but it does not make it easier to pay off when ratios are continually being maxed for purchases/refinances of the past - or if rates rise. Refinances however now are max 80% loan to value, which does help keep spending under control; or at least that is the general idea. However with rates being where they are, using 25 years to qualify should not be an issue, if you are looking at true affordability...and have a goal of being mortgage free in your life time. That all being said, I realize there are strong points of view to both sides, and the grass is not always greener on the other side. But we do have to realize that there is really a bigger picture at work here - not just what we see on the News (which is another discussion all together)... however that bigger picture does affect mostly the New Time Home Buyers, with the new rules and regulations, especially since house prices are really not dropping and quite honestly in what I have seen lately been on the rise. 

If you are house shopping you need to make sure you have an experienced Mortgage Agent working along side your Real Estate Agent, to make sure you are on the right track - helping you to meet your goals and education you along the way. GO back and read the blog about Eye Openers to give you more information...but the 4 points listed above are in full swing, ask me how it could affect you..... and get your ducks in a row today. 


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