New mortgage rules might not make a difference
Brett Browne- 0
- 1 minute read
New mortgage rules from the federal government came into effect today.
First-time home buyers will have the option of stretching the amortization period of their mortgage out to 30 years. That’s an increase of five years from what was previously allowed.
The move, which is designed to make purchasing a home more affordable for first time home buyers, can mean lower monthly payments. Lethbridge mortgage broker, Kim Vucurevich, says those lower payments, however, come at a higher cost in the long run. She says she is not convinced the new rules will bring more people into the market.
Vucurevich says by extending a mortgage from 25 to 30 years, homeowners can expect to pay as much as $66,000 more in interest charges. Plus, the new rules only apply purchases of new homes which she says aren’t affordable for most first-time buyers.
