Dominion Lending Centres Funds Corp. is a mortgage brokerage and leasing company that specializes in the Toronto market. Our goal is to find the best mortgage for our clients and to simplify the mortgage process.


Private mortgage insurers opt not to match CMHC’s cuts

May 2, 2014

Canada’s two private-sector mortgage insurers have decided not to match all of Canada Mortgage and Housing Corp.’s recent product cuts.

Genworth MI Canada sent a letter to banks Friday saying that it will not be making any changes to its standards for self-employed borrowers.

Genworth will, however, tighten its rules for second homes slightly. As of May 30, it will only sell second-home mortgage insurance on homes with one unit in them, rather than two (such as duplexes or a self-enclosed apartment in a house).

Up until now, Genworth has been willing to insure second homes with two units, as long as one of those units was occupied by the mortgage holder or one of their immediate family members.

Canada Mortgage and Housing Corp. (CMHC) said last week that, as of May 30, it will stop insuring mortgages on second homes and will stop offering mortgage insurance to self-employed people who don’t have standard documents to prove their income.

“There will be no amendment to the maximum number of Genworth-insured properties per borrower,” Genworth said in its letter to lenders.

Canada Guaranty, the country’s third-largest mortgage insurer, is similarly limiting its second-home insurance to one unit, but not changing its rules for self-employed borrowers.

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Globe & Mail

CMHC cutting back on what it covers with mortgage default insurance

April 25, 2014

Canada Mortgage and Housing Corp., the Crown corporation that controls the vast majority of mortgage default insurance in the country, says it plans to get out of the market for second homes and is adding restrictions for self-employed Canadians.

Effective May 30, CMHC said it will discontinue insuring second homes and will require self-employed Canadians to have third party income validation.

The Crown corporation said the changes are being made as part of its review of its mortgage loan business. The organization has already said it is raising rates across the board May 1, a move that comes after the federal government last year appointed a new chair for CMHC and brought in a new chief executive.

“CMHC helps Canadians meet their housing needs and contributes to the stability of the housing market and finance system” said Steven Mennill, senior vice-president, insurance, in a release. “As part of the review of its mortgage loan insurance business, CMHC is evaluating its products and services to ensure they are aligned with these objectives.”

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Financial Post

As expected, on April 16, 2014, the BANK OF CANADA announced that it was maintaining its target for the overnight rate at one per cent. The Bank Rate is correspondingly one and a quarter per cent and the deposit rate are three quarters of a per cent.

The Bank continues to see a gradual strengthening in the fundamental drivers of growth and inflation in Canada. This view hinges critically on the projected upturn in exports and investment. With underlying inflation expected to remain below target for some time, the downside risks to inflation remain important. At the same time, the risks associated with household imbalances remain elevated. The Bank judges that the balance of these risks remains within the zone for which the current stance of monetary policy is appropriate and therefore has decided to maintain the target for the overnight rate at 1 per cent. The timing and direction of the next change to the policy rate will depend on how new information influences the balance of risks.

The financial institutions will also keep their Prime Lending rate at 3%. Fixed rates have continued to fall with record low rates of 2.99% for a 5 year term. Variable rates continue to remain steady with 5 year discounted variable rates at Prime -.50%.

The next Bank of Canada Rate Announcement will be on, June 4, 2014.

To discuss your personal situation, contact one of our Mortgage Agents today!

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