New Mortgage Rules for 2011


In January 2011, Canadian Minister of Finance, Jim Flaherty, announced new mortgage rules for Canadians.

New mortgage rules for 2011

New mortgage rules for 2011

The federal government announced that Canadian mortgage insurance rules would become more stringent due to rising household debt in a low-interest rate environment, which essentially will put consumers in financial risk once rates rise. And you know they will rise.

New mortgage rules for 2011

The Bank of Canada and Mark Carney spent their efforts warning Canadians to take it easy on debt in the second half of 2010, due to the fragile economic recovery, high unemployment rate, high Canadian dollar and subdued inflation. That said, Canadian interest rates did not increase significantly in the short-term in order to help Canadians curb debt.

So the Canadian government chose to introduce three new mortgage rules to address concerns on housing-related debt.

New Canadian mortgage rules 2011:

  1. Reduce the maximum amortization period to 30 years for new government-backed insured mortgages with loan-to-value ratios of more than 80% (was 35 years before).
  2. Lower the maximum amount Canadians can borrow in refinancing their mortgages to 85% of the value of their homes (was 90% before).
  3. Withdraw government insurance backing on lines of credit secured by homes, such as home equity lines of credit.

Of all the new rules put in place, reducing the maximum amortization period to 30 years from the current 35 years is going to hurt Canadian families the most.

What do you think of these new rules? Will they influence your decision to buy a home?

If not, feel free to visit and find your dream home today.


  1. Rosy Saadeh says:

    Hi Peter, thanks for your comment. This article was written in 2008, so I agree it is quite outdated. We will update it shortly. Thanks again.

  2. Peter says:

    Your info is inaccurate the mortgage rules have changed in 2011, down to 30.

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