New Mortgage Stress Test Rules


The Department of Finance announced changes to the mortgage stress test yesterday. When the stress test was implemented in 2018, the benchmark was set to the five-year posted rate at Canada's big banks. Effective April 6, the new benchmark, which is used to determine the minimum qualifying rate for insured mortgages, will be the weekly median 5-year fixed insured mortgage rate from mortgage insurance applications, plus 2 per cent. These changes will make the stress test more dynamic, allowing it to ebb and flow, rather than leaving it at a static rate which many critics believed set the bar arbitrarily high.