Unlocking the Dream of Home Ownership

New Rules for Mortgages in a Changing Market

This article is for informational purposes only. Northern Birch Credit Union aims to provide educational resources to help our members make informed decisions. Each member’s financial journey is unique, please consult a qualified professional for advice specific to your individual circumstances.

Exciting news for homebuyers in Canada! The Canadian government has announced significant changes to mortgage rules in 2024, designed to make homeownership more accessible and sustainable. These rules go into effect on December 15, 2024. They help buyers financing a purchase with less than 20% for the downpayment. These mortgages will be categorized as “High-Ratio Insured”. These changes are in addition to those announced earlier this year.

Whether you are purchasing a new home, are a first-time homebuyer or your mortgage is up for renewal, talk to a Northern Birch lending specialist. We understand the current economic climate and prioritize your financial well-being. We will tailor a mortgage to your unique financial goals.

As you explore your home ownership options, consider securing pre-approval so you know what you can afford. Northern Birch offers a 130-day-rate guarantee to give you peace of mind. Should rates increase, your lower, guaranteed rate is secure. However, should rates drop, you’ll benefit from the lower rate during the financing transaction. A pre-approval smooths the process of buying a home.

Key Highlights – High-Ratio Insured Mortgages

Extended Amortization: The government has announced that first-time qualifying homebuyers and/or anyone purchasing a new build can choose to amortize their mortgage for up to 30 years. This is an increase from a maximum 25-year amortization and is available for all property types, not just condominiums. By spreading your mortgage over an extended time period, your monthly payments decrease, giving you more time to pay it off.

Increased Insured Mortgage Limit: The change in this rule reflects the increase in property values. The price cap for insured mortgages has been raised from $1 million to $1.5 million, providing more flexibility for those purchasing higher-priced homes. This helps more Ontarians find a suitable home.

Homeowners with insured mortgages who are switching lenders are not subject to a new stress test: This is a huge advantage when switching or transferring your mortgage from one institution to another. Not having to requalify when renewing your mortgage with a new lender ensures you get the best rate possible. To be clear, switching/transferring your mortgage does not include borrowing additional funds. We encourage you to sit down with a Northern Birch lending specialist today. We work with you to give you our best, competitive rate and manageable monthly payment strategy. More than that, we will reimburse your mortgage transfer legal fees if you choose to make the switch to Northern Birch.*

Don’t forget, right now you can earn up to $3,500* cash back when you choose Northern Birch for your mortgage, giving you a financial boost as you choose appliances, furnishings or cover other costs of homeownership.

How these Changes May Impact You

Increased affordability: The extended amortization period and increased insured mortgage limit is a game-changer. You can benefit from greater flexibility and lower monthly payments, decreasing the stress on your budget.

Increased flexibility: Not having to requalify when renewing with a different lender increases competition and enables more Canadians with insured mortgages to switch to the best deal for them. We look at your whole financial picture and work with you to give you our best rates with repayment terms that make sense for you.

Take Advantage of Being a Northern Birch Shareholder

Because Northern Birch Credit Union is owned by its members, your membership comes with distinct advantages. Our profits are reinvested into the credit union and returned to members in the form of better rates, lower fees and other member benefits. We also share our profits with the community, investing in things like education, senior care, youth programs and events you care about.

Contact Northern Birch to learn more about these rule changes and how they can benefit you.

Let us help you purchase your first home, buy an investment property or refinance your current home. We are here to help you achieve your financial goals.

Call us at 416-922-2551 Option 3 or email lending@northernbirchcu.com to make an appointment with a lending specialist.

*Offers subject to terms and conditions. Visit our website for details.