Naveen  Vadlamudi

Naveen Vadlamudi

Broker, ABR®, SRES®


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What you need to know about the new mortgage rules?

If you (or) your friend is buying a home (or) refinancing, here's what you need to know about the new mortgage rules:

Starting January 1, 2018, new rules take effect: if you applied for a mortgage loan before January 1, 2018, contact our office to find out how this can affect your mortgage loan.


New rules don’t apply when renewing your existing Mortgage loan: The new rules only apply to new mortgage loan agreements.

If you’re refinancing your mortgage, you’ll have to qualify according to the higher stress-test rates rather than your existing contractual mortgage rate.


Borrowers with a down payment of 20% or more will face a stress test. The minimum qualifying rate would determine whether a home buyer would be able to afford their principal and interest payments should interest rates increase. This stress test would use either the 5-year benchmark rate published by the Bank of Canada or the customer's mortgage interest rate plus 2%, whichever is the higher.


The amortization period of CMHC insured mortgage loans has been reduced by 5 years from 30 years to 25 years. This means that mortgages will be paid off faster by borrowers, but their monthly payments will be higher

If you're buying a home or renewing your mortgage, need any help.

Call Naveen @ 416-837-9696.





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