Jun 21, 2012
By Jane Brown
Empty nesters buying condos will now need a larger downpayment as Canadian mortgage rules get tighter.
Finance Minister Jim Flaherty announced Thursday morning that he will lower the maximum amortization period on a mortgage from 30 years to 25, meaning payments will be higher but mortgages will be paid off more quickly.
He’ll also limit refinancing loans to 80 percent of a home’s value, from the current 85. Flaherty’s announcement comes as the latest statistics show that household debt has climbed to 152 percent of disposable income.
This is the fourth time the Finance Minister has tightened mortgage rules in a bid to rein in household debt, which has ballooned amid record low interest rates.