With the March 18 cutoff for new mortgage rules come and gone, many people are still a little confused on how it will affect new mortgages going forward along with their current CMHC insured mortgages.
These new rules affect you if:
a) If you were planning to get a 35-year amortization, the maximum amortization available to Canadians now will be 30 years. If you have an existing 35 year amortization, it will continue uninterrupted without and changes to your existing mortgage.
b) If you were planning to refinance your existing mortgage, you were allowed to refinance up to 90% of the value of your home. That number is now 85% at a maximum.
c) If you were planning on acquiring a HELOC (or Home Equity Line of Credit) to complete those home renovations you've been planning. The government has announced that it will no longer insure these mortgages - meaning lenders are going to have to take on the associated risk themselves. For the most part, lenders already did this, so this change will not affect too many lenders.
One thing to note is if you already have an existing 35-year amortization, you're not quite out of the woods. If you plan on moving to a more expensive home in the future - one that will require you to increase the size of your mortgage - you won't be able to keep that 35-year amortization. If you're able to port your mortgage and keep it the exact same amount, you can hold onto the 35-year amortization.
As always, if you have any further questions surrounding the new mortgage rules, please feel free to give me a call. If I don't have the answer, I'll be sure to find it for you!