CAAMP is using several routes to get an unequivocal message to Ottawa: lender underwriting has nothing to do with concerns about the CMHC’s $600 billion insurance cap.
“During the past week, there has been extensive media coverage and announcements affecting the mortgage industry,” writes CAAMP in a message to its members last week, outlining its lobby efforts. “The issue of lenders and the mortgage insurance ceiling has nothing to do with lending practices, but rather liquidity and capital requirements.”
Many of its members have offered the same analysis since CMHC warned lenders that access to that insurance fund for so-called bulk insurance to cover conventional mortgages might effectively be rationed as it comes within 10 per cent of its $600 billion cap.
“OSFI's lender audits on NIQ (Non Income Qualified) products and news that the government guaranteed mortgage insurance ceiling is approaching its limit directly affect the type of mortgage products that can be offered and the way in which mortgages are funded,” says CAAMP, pointing to several lobbying efforts meant to protect the mortgage industry from another round of mortgage rule changes.
CAAMP is now speaking with lenders, insurers and brokers to evaluate those facts and their implications.
It is also communicating regularly with the Minister of Finance’s Office in Ottawa, reads the update, at the same time it moves to retain an Ottawa lobbyist.
Despite those efforts, brokers are increasingly worried the government will further tighten mortgage rules this year as a way of ratcheting down on household debt. CAAMP argues that as unnecessary.
“Government has already tightened lending criteria significantly and mortgage volumes have decreased,” it says. “Arrears and defaults in Canada remain low and are declining, (and) homeowners have significant equity and are paying down their mortgages. As an industry, we are vigilant and caution against further measures that could precipitate a weakening of the housing market.”
It’s a message CAAMP is also hoping its individual members will take to their respective MPs, the association now preparing a detailed set of messages for them to share with your local media.