---
title: New mortgage financing rules to take effect February 15
description: Finance Canada has made changes to Canadian mortgage financing rules which will take effect on February 15, 2016, in time for the spring housing market.
image: https://www.koroll.ca/hubfs/Blog_Images/Canadian_mortgages.jpg
---

[![Koroll & Company - Newmarket CPAs](https://www.koroll.ca/hs-fs/hubfs/images/Logos/koroll_blue.png?width=247&height=65&name=koroll_blue.png "Koroll & Company - Newmarket CPAs")](https://www.koroll.ca/)

[![Certified Professional Accountants Newmarket](https://www.koroll.ca/hs-fs/hubfs/images/Logos/CPALogo_2014_notext_72.png?width=82&name=CPALogo_2014_notext_72.png "Certified Professional Accountants Newmarket")](https://www.cpacanada.ca/)

![AdobeStock_77939924_WM.jpeg](https://www.koroll.ca/hs-fs/hubfs/images/Banners/taxesBannerBlueStrip-1.jpg?width=2000&name=taxesBannerBlueStrip-1.jpg "AdobeStock_77939924_WM.jpeg")

# Koroll & Company Blog

- [Tax Deductions (118)](https://www.koroll.ca/koroll-and-company-blog/topic/tax-deductions)
- [Tax Tips (88)](https://www.koroll.ca/koroll-and-company-blog/topic/tax-tips)
- [CRA (85)](https://www.koroll.ca/koroll-and-company-blog/topic/cra)
- [Corporate (84)](https://www.koroll.ca/koroll-and-company-blog/topic/corporate)
- [Small Business (61)](https://www.koroll.ca/koroll-and-company-blog/topic/small-business)
- [Pension Plans (30)](https://www.koroll.ca/koroll-and-company-blog/topic/pension-plans)
- [RRSP (22)](https://www.koroll.ca/koroll-and-company-blog/topic/rrsp)
- [Education (14)](https://www.koroll.ca/koroll-and-company-blog/topic/education)
- [TFSA (14)](https://www.koroll.ca/koroll-and-company-blog/topic/tfsa)
- [Real Estate (13)](https://www.koroll.ca/koroll-and-company-blog/topic/real-estate)
- [COVID-19 Updates (7)](https://www.koroll.ca/koroll-and-company-blog/topic/covid-19-updates)
- [E-Commerce (2)](https://www.koroll.ca/koroll-and-company-blog/topic/e-commerce)
- [Internet (2)](https://www.koroll.ca/koroll-and-company-blog/topic/internet)
- ["Ontario Budget" (1)](https://www.koroll.ca/koroll-and-company-blog/topic/ontario-budget)
- [Insider (1)](https://www.koroll.ca/koroll-and-company-blog/topic/insider)

[see all](https://www.koroll.ca/koroll-and-company-blog/new-mortgage-financing-rules-to-take-effect-february-15#)

## [New mortgage financing rules to take effect February 15](https://www.koroll.ca/koroll-and-company-blog/new-mortgage-financing-rules-to-take-effect-february-15)

 [fa icon="calendar"] Feb 4, 2016 10:00:00 AM / by [Allen Koroll](https://www.koroll.ca/koroll-and-company-blog/author/allen-koroll)

- [Tweet](https://twitter.com/share)

![New Canadian Mortgage Financing](https://www.koroll.ca/hs-fs/hubfs/Blog_Images/Canadian_mortgages.jpg?width=320&name=Canadian_mortgages.jpg "New Canadian Mortgage Financing")As the time for the traditionally strong spring housing market approaches, the current state of Canadian real estate is on the minds of a lot of Canadians these days. It’s also a concern for Finance Canada, which has made a change to Canadian mortgage financing rules which will take effect on February 15, 2016, in time for the spring housing market.

For a number of reasons, Canada’s mortgage financing market never experienced the excesses which occurred in the United States, and which culminated in the mortgage and financial market meltdown in 2008-09. Nonetheless, the Canadian government was sufficiently concerned that it made a series of changes to the rules governing Canadian mortgage financing between 2008 and 2012. Those rules, all of which were aimed at ensuring that Canadians could actually afford the homes they wanted to buy, included the following:

- increasing the minimum down payment to 5%;
- decreasing the maximum amortization period to 25 years;
- limiting the maximum insurable house price to below $1 million;
- applying maximum debt service-to-income ratios; and
- applying a mortgage rate stress test for mortgages with terms of less than 5 years or variable rates.

 The latest change in mortgage financing rules, announced in December 2015, is more targeted in nature. Specifically, the change affects only homes sold for more than $500,000. Since the average price of a home sold in Canada in October 2015 through the Multiple Listing Service was $453,000, this latest change will likely have the greatest impact in major metropolitan markets, particularly Toronto and Vancouver.

While the minimum down payment for purchasing a home in Canada is 5%, mortgage insurance is required where that down payment is less than 20% (The exception is homes purchased for $1 million or more, where the minimum down payment is 20%.) Such mortgage insurance is provided through a federal government agency, the Canada Mortgage and Housing Corporation, and backed by the federal government.

| That new rule provides that the minimum down payment for new insured mortgages will increase from 5% to 10%, but only for the portion of the house price above $500,000. In other words, the minimum down payment on the first $500,000 paid for a home remains 5%, or $25,000. Once the home price is over that threshold, the required down payment effectively rises with increases in the price of the home, as shown in the following chart released by the Department of Finance. **       Minimum Down Payment by Home Purchase Price: Existing and New Eligibility Rules** |  |  |  |  |
| --- | --- | --- | --- | --- |
| **Home Purchase Price** | **Existing Eligibility Rules** | ** Eligibility Rules Effective        February 15, 2016** |  |  |
|   |   |  |  |  |
| **Minimum Down Payment Percentage** | **Minimum Down Payment Amount** | **Minimum Down Payment Percentage** | **Minimum Down Payment Amount** |  |
| $500,000 and below |      5% |    up to $25,000 |        5% |              up to $25,000 |
| $600,000 |      5% |        $30,000 |      5.8 % |                     $35,000 |
| $700,000 |      5% |        $35,000   |      6.4 % |                     $45,000 |
| $800,000 |      5% |        $40,000  |      6.9 % |                     $55,000 |
| $900,000 |      5% |        $45,000 |      7.2 % |                     $65,000 |
| $999,999 |      5% |        $50,000 |      7.5 % |                     $75,000 |
| $1,000,000 and above |     20% | $200,000 and up |       20% |             $200,000 and up |

 The Department of Finance press release announcing the change can be found on the Finance website at[www.fin.gc.ca/n15/15-088-eng.asp](http://www.fin.gc.ca/n15/15-088-eng.asp), and that press release includes a link to a Backgrounder providing additional details of mortgage financing rules in Canada.

[![Book A Free Consultation](https://no-cache.hubspot.com/cta/default/1577306/b06a76bd-288d-4d2f-9a8c-41fd86ee8e2f.png)](http://cta-redirect.hubspot.com/cta/redirect/1577306/b06a76bd-288d-4d2f-9a8c-41fd86ee8e2f)

---

The information presented is only of a general nature, may omit many details and special rules, is current only as of its published date, and accordingly cannot be regarded as legal or tax advice. Please contact our office for more information on this subject and how it pertains to your specific tax or financial situation.

## About Koroll & Company

 At Koroll & Company we grow our firm through satisfied clients referring us as a trusted accounting firm to their friends, family members and associates. The only way we know how to achieve this is strive to exceed your expectations and provide you with exceptional service. We have 20+ years servicing Newmarket, ON and the surrounding areas, and look forward to servicing you next. So give us a call and speak to a friendly staff member from Koroll & Company today!

 Topics: [Real Estate](https://www.koroll.ca/koroll-and-company-blog/topic/real-estate)

![Allen Koroll](https://www.koroll.ca/hubfs/Koroll_and_Co_Staff_Pictures/Allen_Koroll_CGA_Newmaket_Picture.png)

#### Written by [Allen Koroll](https://www.koroll.ca/koroll-and-company-blog/author/allen-koroll)

### Subscribe to Email Updates

- Recent
- Popular
- Categories

### Lists by Topic

- [Tax Deductions (118)](https://www.koroll.ca/koroll-and-company-blog/topic/tax-deductions)
- [Tax Tips (88)](https://www.koroll.ca/koroll-and-company-blog/topic/tax-tips)
- [CRA (85)](https://www.koroll.ca/koroll-and-company-blog/topic/cra)
- [Corporate (84)](https://www.koroll.ca/koroll-and-company-blog/topic/corporate)
- [Small Business (61)](https://www.koroll.ca/koroll-and-company-blog/topic/small-business)
- [Pension Plans (30)](https://www.koroll.ca/koroll-and-company-blog/topic/pension-plans)
- [RRSP (22)](https://www.koroll.ca/koroll-and-company-blog/topic/rrsp)
- [Education (14)](https://www.koroll.ca/koroll-and-company-blog/topic/education)
- [TFSA (14)](https://www.koroll.ca/koroll-and-company-blog/topic/tfsa)
- [Real Estate (13)](https://www.koroll.ca/koroll-and-company-blog/topic/real-estate)
- [COVID-19 Updates (7)](https://www.koroll.ca/koroll-and-company-blog/topic/covid-19-updates)
- [E-Commerce (2)](https://www.koroll.ca/koroll-and-company-blog/topic/e-commerce)
- [Internet (2)](https://www.koroll.ca/koroll-and-company-blog/topic/internet)
- ["Ontario Budget" (1)](https://www.koroll.ca/koroll-and-company-blog/topic/ontario-budget)
- [Insider (1)](https://www.koroll.ca/koroll-and-company-blog/topic/insider)

[see all](https://www.koroll.ca/koroll-and-company-blog/new-mortgage-financing-rules-to-take-effect-february-15#)

### Posts by Topic

- [Tax Deductions (118)](https://www.koroll.ca/koroll-and-company-blog/topic/tax-deductions)
- [Tax Tips (88)](https://www.koroll.ca/koroll-and-company-blog/topic/tax-tips)
- [CRA (85)](https://www.koroll.ca/koroll-and-company-blog/topic/cra)
- [Corporate (84)](https://www.koroll.ca/koroll-and-company-blog/topic/corporate)
- [Small Business (61)](https://www.koroll.ca/koroll-and-company-blog/topic/small-business)
- [Pension Plans (30)](https://www.koroll.ca/koroll-and-company-blog/topic/pension-plans)
- [RRSP (22)](https://www.koroll.ca/koroll-and-company-blog/topic/rrsp)
- [Education (14)](https://www.koroll.ca/koroll-and-company-blog/topic/education)
- [TFSA (14)](https://www.koroll.ca/koroll-and-company-blog/topic/tfsa)
- [Real Estate (13)](https://www.koroll.ca/koroll-and-company-blog/topic/real-estate)
- [COVID-19 Updates (7)](https://www.koroll.ca/koroll-and-company-blog/topic/covid-19-updates)
- [E-Commerce (2)](https://www.koroll.ca/koroll-and-company-blog/topic/e-commerce)
- [Internet (2)](https://www.koroll.ca/koroll-and-company-blog/topic/internet)
- ["Ontario Budget" (1)](https://www.koroll.ca/koroll-and-company-blog/topic/ontario-budget)
- [Insider (1)](https://www.koroll.ca/koroll-and-company-blog/topic/insider)

[see all](https://www.koroll.ca/koroll-and-company-blog/new-mortgage-financing-rules-to-take-effect-february-15#)

### Recent Posts

### Navigation

[![Book a Corporate Consultation ](https://no-cache.hubspot.com/cta/default/1577306/d01d118a-226f-4228-b26d-7c2ce0d13ccf.png)](https://cta-redirect.hubspot.com/cta/redirect/1577306/d01d118a-226f-4228-b26d-7c2ce0d13ccf)

![](https://www.koroll.ca/hs-fs/hubfs/images/Logos/koroll_white.png?width=247&height=65&name=koroll_white.png "koroll_white.png")

 

We've proudly served Newmarket and the surrounding region for over 20+ years. We pride ourselves on delivering value to all our clients, and providing up-to-date expertise and knowledge. 

 

[![facebook icon](https://www.koroll.ca/hubfs/2023/square-facebook.svg)](http://www.facebook.com/korollandcompany) [![linkedin icon](https://www.koroll.ca/hubfs/2023/linkedin.svg)](https://www.linkedin.com/company/allen-h.-koroll-c.a.-professional-corporation) [![twitter icon](https://www.koroll.ca/hubfs/2023/twitter-x-white.svg)](https://twitter.com/KorollandCo)

### Contact

[38 Prospect Street  
Newmarket Ontario L3Y 3S9](https://www.google.com/maps/place/Koroll+%26+Company+Chartered+Professional+Accountants+Professional+Corporation/@44.0593338,-79.4562737,17z/data=!3m1!4b1!4m2!3m1!1s0x882ad2096531cf1d:0x7bf5f55f9fcb9b00?hl=en-US)

[905-898-4231](tel:+19058984231)

[![Contact Us](https://no-cache.hubspot.com/cta/default/1577306/f8ffd2cd-cfd6-4927-b6ec-0b5e267faf4c.png)](https://cta-redirect.hubspot.com/cta/redirect/1577306/f8ffd2cd-cfd6-4927-b6ec-0b5e267faf4c)

Copyright 2026 | [Privacy Policy](https://www.koroll.ca/privacy-policy) | [Terms & Conditions](https://www.koroll.ca/terms-conditions) | Created by [The Brit Agency](https://www.thebritagency.com/)

[[fa icon="chevron-up"]](https://www.koroll.ca/koroll-and-company-blog/new-mortgage-financing-rules-to-take-effect-february-15#)