Lender issues notice to brokers

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The new mortgage rules continue to wreak havoc.

MCAP has announced changes to its lending practices following the recent mortgage rule changes. The changes include an upcoming surcharge for all refinances.

The notice, sent from MCAP to its broker partners and obtained by MortgageBrokerNews.ca, can be viewed below.




This follows news that Merix/Lendwise had pulled its rental program and that it now requires refinances to close before November 15, 2016.

MortgageBrokerNews.ca has also confirmed First National has suspended its own rental program, as well as its Alt-A business-for-self program.
 
  • DM on 2016-10-06 4:12:46 PM

    is it not funny that the Minister of Finance had meeting with our Bankers institute and the top 6 banks in last 3 weeks.....

  • Katy on 2016-10-06 4:20:40 PM

    So much for consumers having choice. Why aren't they going after the banks and their high interest rates on credit cards? That's what puts people in financial trouble.

  • Dave on 2016-10-06 4:23:36 PM

    So what happens to people that bought new homes and condos not closing for another year or 2? And they were planning for 5% or 10% down and maxed out on ratios? This could get real ugly....

  • Stephanie Gotobrokers on 2016-10-06 4:36:58 PM

    We are at a time in the country where specific policies perhaps should apply to specific zones.
    Hence Toronto & Vancouver is not small town Canada.

  • Nikki Taddeo on 2016-10-06 4:37:33 PM

    Totally agree Katy. Banks are killing us with their high interest rates for credit cards which is much of the reason refinances are needed in the first place.

  • Jennifer Rossides on 2016-10-06 4:44:16 PM

    We need to get the message out to the consumers of how these changes will really effect them - higher interest rates, reduction in mortgage products, less competition in the market place. All in all bad for consumers but great for the banks who can take back their market share they have lost.

  • kac on 2016-10-06 4:48:18 PM

    what a knee jerk reaction by supposed broker lenders who will be out of business in a matter of months.

    my god what a country we live in ,hopefully the finance minister has a mortgage coming due for renewal with a bank that will give it to him between the eyes as he has taken away competition and the banks are fre to renew at whatever rates they choose.

  • John B on 2016-10-06 5:06:26 PM

    @Katy - it's a common misconception in the mortgage broker community that high interest rates on credit cards get people in financial trouble, but if all the outstanding credit credit cards defaulted ($77 billion), vs the same in mortgages, the default in mortgages would be much worse. If $77 BN defaulted in mortgages, the rate would be 5% of all outstanding mortgages that taxpayers, such as yourself, would be on the hook for since CMHC doesn't have the funds to guarantee all of those mortgages (or, if it was 50% of those mortgages, $37 BN).

    If $77 BN of credit cards defaulted, the major losers would be the credit card issuers... banks, more or less, and their shareholders.

    There is still choice for the consumer, and given the changes, it'll cost a little bit more but it's nice to see that MCAP and RMG are carrying on business as usual, but with a bit of a premium since they have to carry the risk themselves instead of obtaining portfolio insurance.

  • Cara on 2016-10-06 5:38:38 PM

    I completely agree Kathy! I've been saying same for years and have yet to hear of any verification requirements or mandated proof of income to take on up to a small mortgage in credit card availability across numerous greedy credit card companies easily sending out cards with 24% average interest rates. No, let's knock out 20% of potential home buyers and keep them in rentals because that will surely drive the economy on the right track! If politicians could live in real world problems, we wouldn't have this ridiculousness, they haven't a clue what goes on "down here"!

  • Nikki Taddeo on 2016-10-07 7:47:05 AM

    How irresponsible of the Liberal Government..... this is absolutely ridiculous. They have not thought this through at all. We will not be silent about this, that's for sure!

  • Michael Mitchell on 2016-10-07 8:03:44 AM

    Where was our support,this will kill brokers!!

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