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 OSFI Guideline B-20, which should be reconsidered. Specifically, the government and OSFI 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.
