TREB Continues Call for Reconsideration of Mortgage Stress Test & 30 Year Amortization – Letter to Minister & OSFI
In a letter to Finance Minister Bill Morneau and the Office of the Superintendent of Financial Institutions (OSFI), TREB is continuing to call for a review and reconsideration of the current mortgage underwriting “stress test” imposed by OSFI Guideline B-20, as well as 30-year amortizations for federally insured mortgages. The test is requiring home buyers in the GTA to qualify to pay an average of $700 more per month than what they will actually pay.
Unfortunately, policy intervention can sometimes have unintended consequences, and we believe this to be the case with OFSI Guideline B-20, which should be reconsidered. Specifically, the government and OFSI should review this policy to determine if home buyers are being stress tested against rates that are realistic. Homebuyers in the GTA, and the rest of the country, deserve a review and more discussion on this issue.
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