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Canada Tightens Mortgage Eligibility, Closes Loophole

  • Federal finance minister acts again in bid to cool hot markets
  • Low-ratio mortgages will face stricter eligibility rules
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Housing Policies to Pave Way for a BoC Cut

Corrected

Canadian Finance Minister Bill Morneau unveiled new measures that tighten access to mortgage insurance for commercial banks and closes a tax loophole on homes purchased by foreigners, amid warnings of a potential housing crash.

Morneau, in an announcement Monday in Toronto, said mortgages with a down payment of more than 20 percent will face the same eligibility requirement for insurance as those with lower down payments. The government will also close a tax loophole that allows non-residents to buy homes and later claim an exemption on the sale.