Significant Mortgage rules changes over the past 4 years
The following are the changes in mortgage rules over the past 4 years including all of 2012’s changes:
2012
- LOC (line of credit) reduction to a maximum of 65% LTV (loan to value)
- Stated income for BFS (business for self) programs require 35% down now
- Cash-back no longer accepted as down payment
- Qualifying rates on conventional lending to now use the 5 year benchmark rate for terms of less than 5 years and VRM’s (variable rate mortgages)
- 30 year amortization gone for high ratio mortgages, now 25 years
- No mortgage insurance (CMHC, etc) for properties over 1 million
- Lower maximum LTV (loan to value) for refinances. Was 85%, now 80%
- GDS (gross debt servicing) reduced from 44% to 39%
- Rental property down payment requirement is now 35% from 20% with many lenders
2011
- 35 year amortization gone for high ratio mortgages, now 30 years
- Lower maximum LTV (loan to value) for refinances. Was 90%, now 85%
- Elimination of government insurance on LOC’s (line of credits)
2010
- Qualifying rates on high ratio lending to now use the 5 year benchmark rate for terms of less than 5 years and VRM’s (variable rate mortgages)
- Lower maximum LTV (loan to value) for refinances. Was 95%, now 90%
- Rental property down payment requirement is now 20% from 5%
2008
- Minimum down payment changed from 0% to 5%
- Minimum beacon score of 620 required for high ratio lending
- New loan documentation requirement standards
- 45% maximum TDS ratio
- 40 year amortization gone for high ratio mortgages, now 35 years