Bank of Canada to drop qualifying rate

Centum Intouch Mortgage Solutions broker Anthony Venuto sees the lower qualifying rate as being primarily helpful to borrowers are on the verge of receiving funding who still need a slight boost.

“It’s not like a person was going to qualify for $500,000 and all of a sudden they can qualify for $550,000,” he says.

It's a small change to be sure, but in the current environment, says BMO chief economist Doug Porter, every bit helps.

“Any change can make a difference at the margin, even if tiny,” he says. “I believe the much bigger issue for the housing market will be the broader economic outlook and the extent to which activity and jobs can recover as the re-opening progresses. Rates still matter, but much less so than in the recent past.”

CMHC might trim mortgage underwriting arm

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JayLove06 wrote: ↑ Bears and Bulls can read the same article and have completely different views. What a world

DDHLeigh wrote: ↑ From the article: "The Bank of Canada is set to reduce its qualifying rate ten basis points, from 5.04 to 4.94 percent". That is only a difference of 0.10%

oasis100 wrote: ↑ bears are going to disappear.

at first they thought prices will crash. now the bears are saying 6 months from now. 6 months from now they will say another 6 months.

fact is this. prices are actually up in a lot of areas. and certainly still above even nov 2019 pricing. how do I know? because I did like 6 condl deals in the month of Novemeber and each one of those properties are worth more today.

love to hear these prognostications by people who have no idea about the realities.

alanbrenton wrote: ↑ Hopefully CMHC doesn't raise down payment to 10% for PRs and Citizens. For outsiders, ban CMHC from insuring those mortgages.

DDHLeigh wrote: ↑ From the article: "The Bank of Canada is set to reduce its qualifying rate ten basis points, from 5.04 to 4.94 percent". That is only a difference of 0.10%

JayLove06 wrote: ↑ CMHC does not insure investment properties.

alanbrenton wrote: ↑ https://www.cmhc-schl.gc.ca/en/finance- ... -newcomers

Newcomers to Canada are an important and growing segment of Canada’s population, creating new market opportunities. CMHC-insured financing is available to borrowers with permanent and non-permanent residency status.

Specific requirements
Non-permanent residents must be legally authorized to work in Canada (with a work permit). Mortgage loan insurance is limited to the purchase of a 1-unit property, owner-occupied. The minimum down payment is 10% and must be from traditional sources only.

Establishing Creditworthiness
U.S. country of origin: In the absence of a sufficient credit report from a Canadian credit reporting agency, CMHC will obtain an international credit report.

For all other countries: Where the creditworthiness cannot be verified through an international credit record, mortgage professionals should ask the borrower to provide a letter of reference from their financial institution in their country of origin.

JayLove06 wrote: ↑ What does any of that have to do with "CMHC does not insure investment properties"?

Qrewpt wrote: ↑ You may be projecting the future by what you see in the rear view mirror. What prices do in the next 6 months is meaningless unless employment bounces back hard. People don't day trade real estate. RE investing seems like a pretty high risk low reward right now. I hope you're right and I'm wrong.