Easier Mortgage Stress Test Rate to Arrive in April
The Department of Finance announced on February 18 that it will be tweaking the qualification criteria used in the stress test, to go into effect on April 6 – just in time for the busiest housing market season of the year. Under the new changes, the benchmark rate – also referred to as the “floor” – used to set the stress test threshold for borrowers will be changed from the five-year rate set by the Bank of Canada (which in turn is set by an average of the posted five-year rates offered by the Big Six banks) to the weekly five-year median insured mortgage rate used in mortgage insurance applications, plus 2%.
Original Article Source Credits: toronto storeys, https://torontostoreys.com/
Article Written By Penelope Graham
Original Article Posted on : February 20, 2020
Link to Original Article: https://torontostoreys.com/easier-mortgage-stress-test-april-2020/