{"id":36627,"date":"2016-11-29T11:44:46","date_gmt":"2016-11-29T16:44:46","guid":{"rendered":"http:\/\/www.northeastmortgages.ca\/?p=36627"},"modified":"2016-11-29T11:44:46","modified_gmt":"2016-11-29T16:44:46","slug":"cmhc-recommends-increasing-minimum-down-payment","status":"publish","type":"post","link":"https:\/\/www.nordest.ca\/blogue\/en\/cmhc-recommends-increasing-minimum-down-payment\/","title":{"rendered":"CMHC Recommends increasing Minimum Down Payment"},"content":{"rendered":"

CMHC recommended this week that the minimum down payment is increased. Evan Siddall CEO of CMHC gave a speech\u00a0last week at the Bank of England’s\u00a0offices. He recommended that the government\u00a0take further action and increase the minimum down payment required for someone to buy a home. This recommendation was made on the heels of recent policy changes<\/a> introduced by the federal government over the last month.<\/p>\n

Sidel said. “Politicians are tempted to help first-time homebuyers enter the market, but low down payments may be part of the problem, adding to affordability pressures and macroeconomic vulnerabilities,”<\/p>\n

By increasing the minimum Down payment the effects of low rate mortgages will be offset. The rate wars that\u00a0have plagued our industry over the last couple of years thanks to unscrupulous\u00a0banks\u00a0who put in place restrictive mortgages and mortgage brokers who peddle substandard mortgage products to gain market share are rearing their ugly head today.<\/p>\n

I have said it before and I will say it again\u00a0large corporations and government policymakers need to stop driving while looking in the rearview mirror. The ink is still drying on the last series of changes that were made and now they are talking about making more changes that can ultimately destroy an already fragile market.<\/p>\n

Further to the changes just mentioned CMHC is also recommending\u00a0that the government put in place a loan to income limit that will\u00a0restrict borrowers in the size of the loan that they would be able to get. Currently,\u00a0we have in place a series of calculations that are used to determine the max that a borrower can qualify for these are called indebtment ratios or otherwise known as GDS & TDS calculations. These ratios limit the amount that a borrower can get based on their gross revenues.<\/p>\n

Loan to income calculations has been put in place in various countries around the world. The way they work is simple if you earn an annual income of $50,000 and you get a mortgage of $150,000. In this case, you would have a ratio of 3 this means your loan is equal to 3 times your annual income.\u00a0In the UK the most lenders will typically approve is 5x annual income. It remains to be seen if Canad will follow suit with these changes.<\/p>\n

As always I am available for comment or any questions<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

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CMHC recommended this week that the minimum down payment is increased. Evan Siddall CEO of CMHC gave a speech\u00a0last week at the Bank of England’s\u00a0offices. He recommended that the government\u00a0take further action and increase the minimum down payment required for someone to buy a home. This recommendation was made on the heels of recent policy changes introduced by the federal government over the last month. Sidel said. “Politicians are tempted to help first-time homebuyers enter the market, but low down payments may be part of the problem, adding to affordability pressures and macroeconomic vulnerabilities,” By increasing the minimum Down payment…<\/p>\n","category_list":"Market Updates<\/a>","author_info":{"name":"Terry Kilakos","url":"https:\/\/www.nordest.ca\/blogue\/en\/author\/hdgyye73sy\/"},"comments_num":"0 comments","yoast_head":"\nCMHC Recommends Increasing Minimum Down Payment For Mortgages<\/title>\n<meta name=\"description\" content=\"CMHC recommended this week that the minimum down payment is increased. Evan Siddall CEO of CMHC gave a speech\u00a0last week at the Bank of England's\u00a0offices. He recommended that the government\u00a0take further action and increase the minimum down payment required for someone to buy a home. How will this affect you? Click Here!\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.nordest.ca\/blogue\/en\/cmhc-recommends-increasing-minimum-down-payment\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CMHC Recommends increasing Minimum Down Payment\" \/>\n<meta property=\"og:description\" content=\"CMHC recommended this week that the minimum down payment is increased. Evan Siddall CEO of CMHC gave a speech\u00a0last week at the Bank of England's\u00a0offices. He recommended that the government\u00a0take further action and increase the minimum down payment required for someone to buy a home. How will this affect you? 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