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[LENDER UPDATE] Clarification Regarding Bank of Canada Qualifying Rate

Clarification Regarding Bank of Canada Qualifying Rate
(Download Update)

In relation to the recent increase of the Bank of Canada 5-year conventional mortgage interest rate (referred to as the “benchmark rate”), Canada Guaranty would like to provide additional clarity regarding the application of the benchmark rate when qualifying borrowers for mortgage insurance.

  • All insured home buyers are qualified for mortgage financing based on an interest rate that is the greater of the contract mortgage rate OR the Bank of Canada benchmark rate, which is published weekly and comes into effect each Monday. Canada Guaranty’s adjudication system automatically reflects the applicable Bank of Canada benchmark rate for qualification purposes.
  • Any new loan applications submitted to Canada Guaranty for insurance are subject to the qualifying interest rate in effect as of the date of submission.
  • Approvals issued for mortgage insurance applications prior to a new benchmark rate increase remain valid and do not require resubmission.
  • If the mortgage insurance application is received after a new benchmark rate increase, the previous, lower benchmark rate is applicable, provided the lender made a legally binding commitment to make the loan to the borrower prior to the effective date of the benchmark rate change.

Should you have any additional questions, please contact a member of our National Accounts team:

Darren Kirk
Vice President, Regional Sales
1.866.414.9109 ext. 7003

Marco De Paolis
Director, National Accounts
1.866.414.9109 ext. 7054

Liz Sanchez
Director, National Accounts
1.866.414.9109 ext. 7070

Mary Putnam AMP
Vice President, Sales and Marketing
Canada Guaranty Mortgage Insurance Company

Telephone 416.640.8936 
Toll Free 866.414.9109 ext. 8936 

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