In less than seven weeks, 35-year amortizations will disappear on High ratio insured mortgages. At the same time, the limit on insured refinances will drop to 85% LTV (from 90%). – NOTE : This does not affect new 5% down purchases just refinances
Borrowers have no later than Thursday, March 17 to arrange a signed lender approval under the current guidelines.
This affects people that might want:
- A 35-year amortization to boost their monthly cash flow or augment their purchasing power; or…
- A 90% Loan to value mortgagee refinance to consolidate high-interest debt, pay for renovations or education, buy investments or fund a rental property down payment
The coming deadline will cause thousands of people to hasten their mortgage plans. Thus far, we’ve heard multiple lenders reporting above-normal mortgage volumes. These elevated volumes will likely continue for the next seven weeks, culminating in an especially busy stretch from March 14-17.
For illustration purposes, assume you want to apply for a $300,000 insured mortgage. Here’s a comparison of lending guidelines before and after March 18.