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Mortgage Broker News | 25 Sep 2013, 12:00 AM Agree 0
The head of the federal bank regulator says she remains concerned that low interest rates are lulling Canadians into a false sense of security – her comments suggesting OSFI could still ratchet down already-tight underwriting.
  • Paolo Di Petta | | 25 Sep 2013, 09:21 AM Agree 0
    I'm pretty sure I warned about all this low interest, cheap debt over a year ago. It was pretty obvious from our appetite for debt that it would produce short term stimulus in exchange for longer term issues. We had the past 10+ years of data to tell us that.

    Nice to see the Bank of Canada finally catching up.
  • Ron Butler | 25 Sep 2013, 10:14 AM Agree 0
    I have to agree with Paolo, ultra low interest rates over several years will require a degree of deleveraging at some point and the point may be looming in 2014.

    The device that OSFI is actively considering is to mandate that every mortgage; not just mortgages less than 5 years or Variable Rate mortgages, every single mortgage offered by a federally regulated institution use the BOC Qualifying Rate. Every mortgage qualified at 5.34%. If the market cools quickly this Fall it may not happen but if October and November heat up we may see more OSFI changes.
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