No More 40 year MTG's or 0 Down

[tm.88]

Federal government rules out 40-year and zero-down mortgages
Fiona Anderson, Vancouver Sun
Published: 2:06 pm
VANCOUVER - The federal government will no longer guarantee 40-year or zero-down mortgages in an effort to avoid a housing crisis like the sub-prime mortgage meltdown experienced in the United States.

In an announcement released today, the government said government-backed mortgages would require a minimum down payment of five per cent and a maximum amortization period of 35 years. The borrower would have to have a consistent minimum credit score and there would be new loan documentation standards.

"Today's announcement marks a responsible and measured approach by the Government to ensure Canada's housing market remains strong and to reduce the risk of a U.S.-style housing bubble developing in Canada," a release issued by the federal Department of Finance said.

The new rules will take effect Oct. 15, 2008 to allow existing mortgage pre-approvals to be used or expire.

The measures relate only to new, government-backed insured mortgages and Canadians who already hold mortgages will not be affected, the release said.

Edmonton Journal:

http://www.canada.com/edmontonjourna...e-6eafa5aed359

Globe & Mail:

http://www.globeinvestor.com/servlet...f0709/GIStory/

News Release: (Government of Canada; Minister of Finance)

http://www.fin.gc.ca/news08/08-051e.html

Backgrounder: (Government of Canada; Minister of Finance)

http://www.fin.gc.ca/news08/data/08-051_1e.html

[Tik-Tok]

Good for some, bad for others.

I benefited greatly from no-down payment mortgage. (If I hadn't gone that route, I would be stuck with a $400g mortgage, instead of a $180g one right now)

[tm.88]

Yea, basically...if you are on the edge thinking of buying and feel you may need a 40 yr mtg you are running out of time.

It is a good step towards keeping a stable economy though.

[Xtrema]

Not enough IMO.

If they really want to stop it, move it back to 25 years and 10%.

So house prices will jump the next 3 months and a huge crash will follow......

[Tik-Tok]

Originally posted by Xtrema
Not enough IMO.

If they really want to stop it, move it back to 25 years and 10%.

So house prices will jump the next 3 months and a huge crash will follow......

If it weren't for the fact that there'd be a MAJOR surplus in houses, I'd be happier than a pig in shit if the market suddenly cut in 1/2. (For those wondering, it's because as it stands, I can't afford to upgrade to a larger house, $600g-$400g = too much difference, however, $300g-$200g = affordable difference)

[kenny]

http://forums.beyond.ca/st/225647/by...down-mortgage/