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New Mortgage Rules in Canada Starting December 15, 2024

December 7, 2024 | Posted by: Nicholas Pratile

The Canadian government is introducing significant changes to insured mortgage rules starting December 15, 2024. These updates are designed to improve accessibility for first-time homebuyers and those looking to enter the housing market. Here are the key highlights:

1. Higher Purchase Price Cap

  • The maximum purchase price for homes eligible for insured mortgages is increasing from $1 million to $1.5 million. This change allows buyers to qualify for an insured mortgage with less than a 20% down payment on more expensive homes, broadening options for first-time buyers.

2. 30-Year Amortization for Insured Mortgages

  • First-time homebuyers and those purchasing new builds with less than a 20% down payment can now opt for a 30-year amortization period instead of the previous 25 years. This adjustment reduces monthly payments, making homeownership more financially manageable and potentially increasing borrowing power by 5% to 10%.

3. Minimum Down Payment Requirements Remain

  • The down payment structure is unchanged:
    • 5% on the first $500,000 of the home price.
    • 10% on the portion above $500,000 for homes below $1.5 million.
  • Homes priced above $1.5 million still require a 20% down payment or more.

What This Means for Buyers

These changes aim to support Canadians facing affordability challenges in high-priced housing markets. The increased purchase price cap and extended amortization provide greater flexibility, especially for younger buyers managing tight budgets or other financial commitments.

If you're considering entering the market or upgrading your home, now might be an excellent time to explore how these changes can benefit you.

Contact Mortgages with Nicholas to explore strategies tailored to your needs.

Let’s make your homeownership dreams a reality!


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