Buying a home is an exciting time.  You're about to take a big step so you'll definitely need some expert advice to ensure your mortgage needs are met with the best solutions.

Whether you are a first time home buyer or buying your next home, selecting the right financing for your home is of MAJOR IMPORTANCE. In today’s market there are many different lenders and products for you to choose from, and on top of that the lending rules and regulations are constantly changing. Therefore, the task of finding the most suitable rate and terms for your new mortgage can become a challenging task.

With the recent mortgage rule changes, now more then ever it is important to work with a trusted mortgage agent or mortgage broker to ensure your approval for the best mortgage rate and mortgages terms, regardless of your credit, income or being self employed or new to Canada

New Rules are making it harder to secure a loan for your first home!

Even if you have 15 to 20% of the property value for down payment, it may not be enough to quality for a loan, under the new rules, from a traditional lender such as a bank. As of January 1, 2018, new regulations were put in place which makes it harder for first time home-buyers and even experienced home-buyers to secure the loan they need.

Are you one of the situations below? 

• You do not meet the regular bank-lending criteria and need to work with an alternate lender
• You are now required to qualify at an above-contract level
• You have 20% down payment or want to refinance your home

What are the new rules and what's the impact?

The rate will be the greater of the five-year benchmark rate published by the Bank of Canada OR the lender contractual mortgage rate +2.0%. For example:OLD RULES

• 20% down payment
• 5-year fixed mortgage rates of 3.24%
• 25-year amortization

A family with an annual income of $100,000 can afford a home worth $579,438.09

NEW RULES

• Applying the new “stress-test”, the family must qualify for the mortgage using the greater of 5.14 % and/or 5.24% (calculated as 2% + 3.24%).
• Therefore, with 20% down payment, a 5-year fixed rate of 5.24%, and 25 year amortization, the family can now afford a home worth $494,045.76
• 
  

The difference is that under the new rules, the family’s affordability has dropped by $85,392.33. As you can see the new rules impact the mortgage you qualify for, with a proper mortgage agent form Citadel Mortgages we can help you understand ow the rules impact and get you approved today!