Mortgage renewal: Now switch lenders without re-taking the stress test
Great news as a few leading banks, soon to be followed by the rest of the pack, have DITCHED THE STRESS TEST for RENEWALS.
This means if you have extra debts or a debt level higher than when you got your mortgage, some banks can now overlook that and still get you the best rates.
there is now an option if you were concerned about renewing due to higher debt loads or if your financial situatoin has changed since you bought your home.
Technically, this means most conventional switch (more than 20% down payment) customers no longer need to prove they can afford a payment based on the minimum qualifying rate (MQR). That rate is at least 2% higher (or 200 bps where 100 bps = 1.oo%) than actual rates.
This news is just out today for BOTH High ratio/ insured (meaning you bought with less than 20% down payment) AND Conventional (meaning 20% or more down payment)
Note, however, that property values for insurable borrowers must be under $1 million unless grandfathered.
To find out more please call (best) 403-681-4376 or email to reach out for more data.
This is a BIG DEAL. For renewals we always had to do the math to ensure you could change banks and many with higher debts than they bought with were not able to change banks. The banks knew this and offered them renewal rates that were way to high, but the home owners had no option. Now you do!
20 year mortgage expert, Mortgage Mark Herman
YES!
Canada’s New Capital Gains Tax Rules and Mortgages
Next pressing issue after 25% tariffs is the Canadian Federal Government’s decision to delay the implementation of its new capital gains tax rules until 2026.
In the 2024 budget Ottawa was set to increase the capital gains inclusion rate – the portion of gains that is taxable – from 50% to 66.7% for individuals earning over $250,000 in annual capital gains, as well as for corporations and most types of trusts.
- That plan has now been pushed back to January 1, 2026.
- For average Canadians this would mainly affect those selling a second residence, such as a cottage.
- The delay could see some properties come onto the market with owners hoping to take advantage of the tax saving.
The government caused panic-selling of Cottage Country Cabins in Ontario, and has now paused the capital gains tax.
We hope this pause will allow a normal sales cycle to take place.
Mortgage Mark Herman, Calgary Alberta mortgage broker near me