New restrictions for obtaining a mortgage?
publiée le 2012-05-10 par HYPOTHECA
Several financial institutions believe that the federal government prepares to implement new restrictions on obtaining mortgages.
This could make it that much more challenging for borrowers to raise the minimum 7.5%. Furthermore borrowers will have to consider that they will also have to have in hand, at least (1.5% times the purchase price) in order to cover the costs of the acquisition. As an example, for a purchase price of $300,000 future borrowers will have to raise $27 000. Some borrowers choose the route of home equity loans versus the more traditional mortgages. The maximum loan to value is of 80% today, but there is some talk of reducing this to 65%.
The government is looking closely at the self-employed borrowers. We expect that this group of borrowers will experience considerable more challenging times in the near future as many lenders have already pulled out of this segment of borrowers or have simply set the interest rates higher. We are referring to self- employed borrowers with low revenues reported on the income tax returns. No longer will this group of borrowers be able to simply access credit by providing larger down payments. Even with considerable down payments certain banks will not have programs to accommodate these borrowers’ needs.
As the needs of each borrower may differ from one to another, as well as the lending policies of the various financial institutions ultimately only your mortgage brokers holds the information to ensure that you obtain the very best in terms and conditions that you so deserve. It is yet to be confirmed with exactitude when we may expect these changes and to what degree they will change, however the lending policies are inevitably going to occur.
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