Changes to Mortgages in the Works
Tuesday, December 22nd, 2009In the light of the sub-prime disaster in the USA, Federal Finance Minister Jim Flaherty announced yesterday that he is considering two major changes to the way home mortgages are delivered in Canada. First, the 5% minimum cash down-payment may be increased. This falls on the heels of the cancellation of the no-cash down mortgage. Secondly, the time to pay out a mortgage may be reduced from the present 25 year [300 month] limit. Buyers in the last couple of years have benefited from 30 and even 35 year amortization limits.
Edmonton home buyers, looking to purchase a home or condo in the next while, need to keep these musings in mind. It may well mean that you will need more cash up front in order to qualify. It may also mean that, with higher monthly payments due to a shorter paydown period, you will pay less interest over time but, in the immediate, have to settle for a home less than what you might have expected.
As always, securing a 90-120 day written mortgage pre-approval at today’s attractive rates only makes sense to the wise and informed buyer!
