Canadian mortgage changes

As a mortgage broker, when it comes to my client's finances I try to remain genuinely objective and look out for their best interest. Frankly, I don't agree with all the changes but I am glad to see that the Federal Government has finally introduced a couple mortgage changes such as reducing home equity lines of credit (aka HELOCs) to 65%.

I can appreciate that housing prices are outrageous in many parts of Canada but I think Quebec pricing remains fairly reasonable. For the most part I think appraisers in the Montreal area are "conservative" for the better. I'm curious to see the impact of the new rules here in the Montreal-area especially with the condo market.

By dropping amortization from 30 to 25 years it seems lower income earners will be eliminated from buying in the short term to medium term. This may not be entirely bad. On the other hand, I am most concerned about recent home buyers that put 5% down, took 30 year amortizations, fixed shorter terms (1 to 3 years) and incorporated lots of over-time and bonus income as part of their income calculations. I've blogged that repossessions in Montreal remains fairly low however I think in the coming years bank repossessions will grow.