New regulation in Canada
Canada’s government has this week decided introduce new banking regulations.
From mid April borrowers in Canada will have loans assessed as if they were taking out a five-year, fixed-rate mortgage, for which rates are higher than on shorter, variable-rate loan.
Equity withdrawals will also be limited where someone refinances, with an upper limit on refinancing of 90 per cent of the loan to valuation ratio.
There will also be a floor of 20 per cent on deposit required on some investment loans deemed “speculative” and where the loan is supported by the Canadian Mortgage Housing Corporation.
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