For the new CMHC mortgage insurance rules for residential mortgages that are taking effect in April, there has been some addition information released as to how qualifying will now take place with respect to repayment assessment.
For all interest terms including the variable interest rate under 5 years, the chartered bank 5 year interest rate posted each week by the bank of canada will be the bench mark to be used when assessing a borrower’s repayment ability on all mortgage applications where the mortgage amount will be more than 80% of the value of the property.
This will make high ratio mortgages requiring mortgage insurance harder to qualify for.