Mortgage Rule Changes

Tracy Head • November 16, 2024

Things are picking up. I have seen a significant increase in the number of purchases I am working on with clients. I’ve done an informal poll of some of my realtor and broker friends and we are all seeing the same increase in activity.


This week I attended a learning session about the recent and upcoming changes to mortgage rules. This year it has felt like changes have been rolled out so often that its hard to stay on top of new policies.


I thought it might be good to go over some of these changes as they will benefit many homeowners and homebuyers. Please note that this is a quick explanation and you may have questions or need clarification on some of what follows so please make sure you speak with your mortgage professional before moving forward with a purchase.


In the order the changes were discussed in our session, here is a high-level overview for you.


Effective August 1, 2024 first-time home buyers (FTHB) were able to purchase a newly built home using a thirty year amortization with a minimum down payment. Prior to this change the maximum amortization allowed for buyers with less than twenty percent down was twenty-five years.


Key to note here is that the definition of a FTHB for purchasing homes is based on the CRA explanation of home buyers starting out or starting over; this includes buyers who have not owned their primary residence (nor lived in a home owned by their significant other) for the last four years. It also includes buyers who are recently separated or divorced.


Also key to note is that only one of the borrowers must qualify as a FTHB for these rules to apply.


For the purposes of Land Transfer Tax in BC, even if clients are considered FTHB under mortgage rules, they will still have to pay Land Transfer Tax if they have ever owned a home anywhere in the world.


There is a small increase to the insurance premium (,2 per cent) if borrowers elect to use the thirty year amortization. 

Effective December 15, 2024 the price cap for insured mortgages will be increased from $1,000,000 to $1,500,000. Clients will be able to purchase a home up to this price with a minimum down payment of five per cent of the first $500,000 and ten per cent of any balance over that and up to $1,500,000. For the full $1,500,000 the minimum down payment will now be $125,000 as compared to the previous minimum down payment of $300,000.


Trying to come up with the required twenty per cent down payment has been a barrier for many borrowers. 

The changes coming into effect December 15 also include the ability for repeat buyers to new builds with a thirty year amortization. 


As well, all FTHB will be eligible to qualify based on a thirty year amortization regardless of whether they are buying a newly built home or an existing home.


For these guidelines to apply mortgage applications must be submitted AFTER December 15.

The final change I’m going to touch on today rolls out effective January 15, 2025.


Existing homeowners will be able to refinance their homes up to ninety per cent of the as-improved value of their home if they are pulling equity to create a secondary suite in their home using a thirty year amortization.

What does “as-improved value” mean?


With these applications we will need to order an appraisal which shows the current value of the home as well as the value of the home once the proposed work is completed. 


Current rules limit refinances to eighty per cent of the value of the home so I see this as a significant benefit for clients who are maybe newer to the housing market and can really use the income from a secondary suite.


There are of course requirements for this program including:

  • Either the borrower or close family member must live in one unit of the property
  • You can add more than one unit to the home (up to a total of four) providing zoning allows for this
  • Units must be completely self-contained
  • Financing limit cannot exceed actual costs of the work


Is your head spinning yet? Mine certainly is, trying to keep all of these changes straight.

Many lenders are still determining their own policies as to how they choose to incorporate these rule changes into the mortgages they offer. It is important to speak with a mortgage professional to see how these changes may impact your borrowing power.

As I mentioned we are already seeing a definite increase in purchase activity. It will very interesting to see if there is a flurry of activity following the implementation of the December 15 changes as well.

Tracy Head

Mortgage Broker

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Changes Affecting Financing

By Tracy Head • November 14, 2025
I consider myself a lifelong learner, which is part of the reason I love my work. Every day there is something new and exciting to learn, or in some cases re-learn. When I first came back to the mortgage world a more seasoned broker gave me a copy of a handout she used with clients. It talked about the ten most important things NOT to do between removing your financing subject and finalizing the purchase of your home. At the time I remember thinking that the handout sounded patronizing and I assumed clients just understood they shouldn’t do any of the ten things. You know what they say about assuming things. Once or twice my clients have made decisions that have almost jeopardized their financing. The reason this came up for me right now is that I am working my way through a training course which is geared towards helping me re-design my team and my workflow, with the ultimate goal of providing even better support to my clients. One of the changes I am going to implement is adding a list very similar to the original ten things not to do list to my signing packages so that we are all on the same page and avoid any potential challenges down the road. What are the ten things? I won’t go over all of them, but here are a few of the things that have surfaced recently: If you change the closing date on your purchase or if you receive the Notice of Completion on a newly built home, advise your mortgage person right away. Never assume your realtor will do this for you. Do not go out and finance anything without checking with your mortgage person. If you are pushing the upper limit of your buying power even a small loan for furniture might put your financing at risk. Many lenders pull your credit again shortly before your mortgage finalizes. Along the same lines, make sure all of your payments are made on time. Do not co-sign a loan for anyone. Do not quit your job or change employers without talking to your mortgage person ahead of time. Do not spend any of the money you have tucked away for your down payment. If you have money sitting in higher-risk investment better to move them to something more stable in case of market fluctuations. Most people think that once they get the ok to remove their financing subject that their mortgage is a done deal. The small print on every mortgage commitment includes a clause that says something along the lines of “Your financing is based on your current situation. Material changes to your situation prior to the funding of your mortgage may affect your approval.” I’m currently working with a young lady that decided to purchase a boat between the time we had our pre-approval conversation and the day she wrote her offer to purchase. She had decided not to buy a home then found her dream property. We’ve had to look at a few options as the boat payment threw her ratios out of line. She is fortunate that her parents are very supportive and are going to gift her the money to pay off the boat loan, but if she didn’t have that back up plan the new loan would have reduced her borrowing power by over $100,000. The reason I added the comment “without checking with your mortgage person” in the bullets above is that every client’s situation is unique and some of those changes might be just fine. Some might not, and the last thing you want to do is find yourself scrambling to figure out a Plan B shortly before closing.  Best to have the conversation and be certain.

Mortgage Options

By Tracy Head • November 1, 2025
In past columns I’ve covered when no means no and when no means maybe there’s another option. There are many aspects of my work that I love. One is that I learn something new each and every day. No two clients are the same and no two applications are the same. Some are easier than others to put together. Another thing I love is that we have so many options to consider when working on our files. I do find immense satisfaction when I tackle a complicated file and find a great solution for my clients. I am working with an amazing young couple as they build their portfolio of rental properties. They are relatively young but both work incredibly hard and really have their ducks in a row. The plot twist they have is that they both transitioned from salaried positions to being self-employed over the last year. Their credit scores are both in the high 800s (900 is a perfect score), they are both making substantial income, and they have saved over $100,000 for their down payment.  Seems like a slam dunk right? Because they don’t have two years of filed tax returns as self-employed business people our options are a bit limited. There is a program we use in this situation but their scenario does not fit within the guidelines. Their dream home just came on the market so they are wanting to buy and convert their current home to a rental property. This particular home came up in the neighborhood they really want to be in, and homes don’t come up very often. It is immaculate and has a legal suite. They had originally approached their bank and been told it was a hard no. I work with their realtor fairly often and she suggested they give me a call. Within 24 hours we had the approval in place for them. We ended up taking the application to an alternative lender for a two-year term. The interest rate is about .5 per cent higher than a chartered back and there is a 1 per cent fee charged. We weighed out the pros and cons of going this route versus holding off until their next tax returns are filed before purchasing another property. After chatting with their financial advisor and accountant they felt it was worth the slightly higher interest rate to be able to buy the home now. I will say I love straightforward simple applications but in reality those are few and far between. Most of the applications I work on these days seem to have some sort of plot twist like this one so I am very grateful there are so many options available to help clients who may fall a little outside of the standard lending guidelines.