GET READY FOR TOUGHER MORTGAGE RULES: Homebuyers should expect tougher mortgage rules to fully kick in by January 1, 2017.

That’s because the Office of the Superintendent of Financial Institutions (OSFI) has released for public consultation revisions to its Capital Adequacy Requirements Guideline (CAR).


OSFI says, “[This] guideline provides a framework for assessing the capital adequacy of federally regulated deposit-taking institutions. … and [it’s] updated periodically to ensure that capital requirements continue to reflect underlying risks and developments in the financial industry,” which includes the Canadian mortgage market.

Along with other revisions, says OSFI, “the draft CAR Guideline has also been updated to include planned revisions to the treatment of insured residential mortgages. […] These changes aim to reinforce the need for banks to exercise prudent underwriting and proper due diligence when originating insured mortgages.”

Moneysense reports

As MoneySense reports, this means “the nation’s financial regulator, banks and lenders that offer mortgage financing will face stricter regulations and this will translate into tougher lending rules for homebuyers.”

In a letter to the industry from December 2015, OSFI highlights that risks in Canada’s mortgage market comtinue to evolve. With household debt growing faster than income and real estate prices heating up. At that time, it announced plans to propose changes to help protect Canadians and financial institutions.

For more information on this or other Ottawa mortgage relates topics contact Kelly Wilson Ottawa Mortgage agent.