"...Committed to keeping lending rates low until June 2010"
Mark Carney, Govenor - Bank of Canada, clearly stated the central bank is committed to keeping the lending rate at .25% until June 2010. He believes the low rate is key to weathering the storm; however, if necessary the central bank also has some other tools available (see link for more details).
Following the Bank of Canada rate drop on Tuesday, the chartered banks lowered their prime lending rate also. Prime is currently 2.25%. Many lender's had anticipated rate drops and were already aggressively pricing the fixed rate mortgages, so we haven't seen many rate changes this week.
NEW guidelines were recently announced by Genworth Financial (one of 2 mortgage insurers available to lenders). The major changes are regarding beacon score, maximum debt servicing ratios and rental properties:
- increase in minimum beacon score
- for Business For Self: min score now 680 and max LTV is 90%
- high rise condo units (building > 4 stories) if LTV is >90%, the beacon requirement is 700