Skip to main content

Copyright © 2022 TERANET

Mortgage Stress Test Benchmark Rate Changes

By February 27, 2020May 13th, 2022Financial Solutions

Canada’s mortgage stress test is being altered.

On February 18, 2020, Minister of Finance, Bill Morneau, announced that the benchmark rate for insured mortgages is changing.

Effective April 6, 2020, borrowers with insured mortgages will need to qualify for a mortgage based on a rate equal to the weekly median 5-year fixed insured mortgage rate, plus 2%.

Currently, the stress test rate for insured mortgages is 5.19% Under the new stress test rate (if it were in effect today), it would be about 4.89%.

“For many middle class Canadians, their home is the most important investment they will make in their lifetime,” Minister Morneau said.

“Our government has a responsibility to ensure that investment is protected and to support a stable housing market. The government will continue to monitor the housing market and make changes as appropriate. Reviewing the stress test ensures it is responsive to market conditions.”

According to Canadian Mortgage Trends, as of 2018 insured mortgages accounted for less than a third of new mortgages.

The Office of the Superintendent of Financial Institutions (OSFI) is also considering a similar benchmark change for stress testing uninsured mortgages. They are accepting input from stakeholders by email until March 17, 2020.

The stress test on insured mortgages has been in place since 2016. The test for uninsured mortgages came into effect in January 2018.

See what Canadian mortgage and financial industry professionals are saying about the stress test changes on the Purview blog:

Discover what this could mean for the real estate market on the GeoWarehouse blog:

What do you think about the new mortgage stress test rules? Share with us on social media. Find us on Twitter and LinkedIn.

Discover our commercial solutions that deliver authoritative registration services, reliable market data, industry insights, and efficient, powerful software to the real estate community. Learn more at