On June 20th, 2021 the Office of the Superintendent of Financial Institutions (OSFI) announced that as of June 1st, 2021, uninsured mortgages will be required to qualify at the greater of the mortgage contract rate plus 2 percent or 5.25%. That is up from the current qualifying rate of 4.79%.
Further, the Deputy Prime Minister and Minister of Finance announced the the federal government will align with OSFI by establishing a new minimum qualifying rate for insured mortgages which will be the greater of the borrower's mortgage contract rate plus 2% or 5.25%. This will apply to all insured mortgages approved on June 1, 2021, or later.
This increase to the qualifying rate is expected to reduce borrowing power by 4-5% for both insured and uninsured mortgages.
If you have questions about how this change affects you please reach out!