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8-8 Strathearn Avenue
Greater Toronto Area , ON , L6T 4L9 Canada
1-416-930-1225

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CMHC and Genworth to raise mortgage default insurance premium


Effective from July 9th. 2012 (Link)

  • Maximum amortization period became 25 years from 30 years.
  • Refinancing LTV reduced to to 80 per cent from 85 per cent of the value of their homes.
  • Limit maximum GDS (gross debt service ratio) at 39% and the maximum TDS (total debt service ratio) at 44%.
  • Maximum insured home price is $1 million.

Government of Canada announced a new sets of mortgage rules to be implemented on March 18, 2011 and April 18, 2011.

In summary the changes were:

  • Maximum amortization period was reduced to 30 years from 35 years for new government-backed insured mortgages with loan-to-value ratios of more than 80 per cent.
  • The maximum amount Canadians can borrow in refinancing their mortgages is now 85 percent reduced from 90 percent of the value of their homes.
  • No more government insurance backing on home equity lines of credit, or HELOCs.

The reaction initially has been positive from the banking industry, but we have to wait to understand the full impact of it.

The adjustments to the mortgage insurance will come into force on March 18, 2011.

The withdrawal of government insurance backing on lines of credit secured by homes will come into force on April 18, 2011.

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About Us

Sudip Adhikari.
Agent License #M10001082
Broker Mortgage Diligent -
Head Office -1305 Matheson Blvd East, Mississauga, ON L4W 1R1
FSCO #10252 O.A.C , E&OE

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