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Stress Test Changes - June 1st 2021



Stress Test Changes

The rumors are officially true. The stress test for BOTH conventional and insured mortgages is increasing June 1, 2021. The new qualifying rate is now 5.25% or the contract rate (the rate you are getting) plus 2%; whichever is greater. This means purchasing power will now be reduced by approximately 5%. Any applications that have been submitted prior to June 1, 2021 are eligible to fall under the current guidelines; remember pre-approvals do not count as an application.


Although this news is discouraging, Regional Mortgage Group is eager to answer any questions you may have and continue guiding you through your buying process!



Office of the Superintendent of Financial Institutions – New Release


OTTAWA ─ May 20, 2021 ─ Office of the Superintendent of Financial Institutions


Today, the Office of the Superintendent of Financial Institutions (OSFI) announced that, effective June 1, the minimum qualifying rate for uninsured mortgages (i.e., residential mortgages with a down payment of 20 percent or more) will be the greater of the mortgage contract rate plus 2 percent or 5.25 percent.


OSFI received over 170 submissions. It is clear that there are a wide range of issues facing homebuyers, including high indebtedness, rapidly rising home prices, housing supply, and competitive bidding. While some of the suggestions fall outside of OSFI’s mandate, we have included a summary of the input received and our response for information.


With the finalization of this consultation, OSFI is also launching a new process to review and communicate the qualifying rate at a minimum annually, every December. This timing is set well in advance of the high-volume spring housing market.”

“In a complicated and sometimes volatile market, the need for sound mortgage underwriting cannot be underestimated. The rate in place as of June 1, 2021 will help support financial resilience, should economic circumstances change, while our commitment to review the qualifying rate, at least annually, will contribute to continued confidence in the Canadian financial system.”

- Ben Gully, Assistant Superintendent, Regulation.


Quick Facts:

  • As of June 1st, 2021, the revised calculation of the minimum qualifying rate for uninsured mortgages will be: - The greater of the contract rate plus 2% or 5.25%.

  • OSFI will review and communicate the qualifying rate at a minimum annually, every December, well in advance of high-volume housing spring season.


Feel free to contact us with any other questions you may have, we would love to help make your dreams a reality!




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