I Got It Wrong

From time to time, we all make mistakes. I am no different than anyone else, and missed something in OFSI’s release on Monday.

It appears that OFSI will allow insured mortgages to switch at renewal to a new lender without the MQR being applied. Insured only. No uninsurable, and no insurable – just insured. No new funds, original amortization. Keep in mind that if you had a static payment variable with a big bank, and it is now at 50+ years, the original am, minus the elapsed portion ( 5 years ) must be maintained. That may rule out a lot of people.

I have no idea how this will playout. With no MQR test, I have no idea what rate we qualify at? Contract? 5.25%? Some random made up number? I guess time will tell.

A very important distinction I want to make though – just because OFSI allows it, doesn’t mean lenders will do it. I imagine we will see this used sparingly, and only when absolutely required. Solid income, fantastic credit, 2 salaried applicants, etc. etc.

Maybe things are looking a little better in our mortgage world? Maybe it was put in as a pressure relief valve in case things get bad? Maybe no lenders will use it?

Time will tell……