Fed gov't discussing new restrictive condo mortgage laws

Fed gov't discussing new restrictive condo mortgage laws

The federal government is focusing on new ways to limit qualifying for mortgage loans on condominiums, according to the Financial Post.
 
Apparently, a new rule in discussion is adding 100 per cent of condominium fees to the expenses list that is measured against income when lenders decide whether the buyer can afford the mortgage. Currently, only 50 per cent of fees are added. The change could exclude thousands of consumers from this high-rise apartment market.
 
“I know for a fact they are talking about it,” said the Financial Post source, who asked not to be named and is close to financial officials.
 
“Some condos have quite large fees and with that only being 50 per cent before that’s a great deal more that lenders will have to be putting on to borrowers’ debt ratio,” said Mortgage Alliance Ontario broker Vince Tripp to MortgageBrokersNews.ca.
 
The national paper also observed that it’s almost certain Ottawa will lower the maximum amortization mortgage period to 30 years from 35, making it harder for Canadians to borrow more than may be necessary.
1 Comments
  • Mortgage Gal 2011-01-18 4:04:03 AM
    I think that they should be added into the approval calculations - Condo Liens take precidence over a Mortgage Charge - as I previously was in Mortgage Default it is very common for people not to be able to afford the condo fees. Some out there are over 700.00 per month - 100% of the fee added into the ratios is a good thing
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