Federal Finance Minister Jim Flaherty has announced three new mortgage rules to take effect on April 19, 2010. Their purpose is to discourage speculation and prevent Canadian borrowers from amassing too much debt. The concern is that Buyers may enter the real estate market on easy terms, only to find themselves in difficulty when interest rates rise.

 • Borrowers must qualify for a five-year, fixed rate mortgage, even if they choose a shorter term and a lower rate. Currently, borrowers must only qualify for a three-year fixed rate.

 • Borrowers will only be able to refinance a property up to 90% of its value. This is down from refinancing to 95% of a property’s value under the current rules.

 • A minimum down payment of 20% will be required for Canadian Mortgage and Housing Corporation insurance on non-owner occupied properties. This represents a 15% rise from the present minimum of 5%.

 These changes will restrict the number of mortgage applications that get approved after April 19th. Economists are predicting a flurry of borrowing activity as Buyers rush to qualify before the April 19th deadline.

 How these rules will influence your move depends on many factors. A discussion with your real estate agent will help clarify your circumstances and show you the road ahead.

 Best Wishes for Success,

 Peter