OREA calls on federal finance committee to relax mortgage rules

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Ontario realtors’ group: ‘ … only (Ottawa) can address these harsh one-size-fits-all mortgage restrictions that are having a real impact’

The Ontario Real Estate Association on Thursday called on the federal government to relax mortgage-lending laws, arguing against what they see as government-imposed barriers to home ownership.

Their three major requests are to restore the 30-year amortization period for those who are insured, to make the stress test more “flexible and reasonable” and to eliminate the required stress test for borrowers looking to switch lenders. Hudak also said that no major parties have offered a plan to address the obstacles to home ownership, hence the letter.

He sees 30-year amortizations as a valuable financial tool as they can allow borrowers to allocate more income to higher-cost debt and less to lower-cost mortgages. That minimizes borrowing costs and in theory could help prudent Canadians retire more quickly. McLister also suggested making the stress tests more adaptable by tying them to an objective reference rate and allowing borrowers who switch lenders to forgo the tests.

 

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