Changes to the Qualifying Rates for Mortgages

The Office of the Superintendent of Financial Institutions (OSFI) announced it will move forward with a proposed new qualifying rate for uninsured mortgages, reinforcing the mortgage underwriting principles outlined in Guideline B-20. As of June 1, 2021, the qualifying rate for all uninsured mortgages should be the greater of the mortgage contractual rate plus 2%, or 5.25%. The change raises the minimum qualifying rate by 46 basis points from the current 4.79%.

The federal government will align with OSFI by establishing a new minimum qualifying rate at the same level for insured mortgages.

Both OSFI and the federal government have indicated they will review the impact of the changes before the end of the year and adjust as necessary. 

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