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Thread: 30 Year Amortizations

  1. #1
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    30 Year Amortizations

    I'm just curious about places that offer 30 year amortizations without stating so. Recently, a broker told me that ING offers them, but their website states:

    You can amortize your mortgage up to 25 years for conventional mortgages, and up to 25 years for high ratio mortgages to help make your regular payments more manageable.
    I called as I'm becoming less and less trusting, and sure enough, they will do 30 years for a conventional mortgage.


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    Is this legal?

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    It's legal for non-CMHC insured mortgages (i.e. 20% or more down).

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    I think credit unions can also offer a 30 year amortized CMHC-insured mortgage. I could be wrong, as I'm now well versed in the rules set out for banks vs. credit unions.

    Personally, I'm interested in a conventional (20% downpayment) mortgage.

  5. #5
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    According to the Dept. of Finance web site, the new rule limiting CMHC-insured mortgages to not more than 25 years was to come into effect July 9, 2012. Perhaps institutions offering 30yr insured mortgages are insuring them with someone other than CMHC.
    Last edited by OhGreatGuru; 2012-09-05 at 05:59 PM.

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    The rule is for insured mortgages.

    Conventional mortgages with >20% down can still have 30 year amortizations. Canadian Mortgage Trends probably has a list of companies still offering 30 year amortizations.

    If I'm not mistaken, there might actually still be companies that offer 35 year amortizations on uninsured mortgages.

  7. #7
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    I'm not getting too excited about the length of amortizations.

    I figure when the housing crash gets into full swing, the damage to the economy will be so bad, the government will change the rules again and introduce 1% mortgages and 50 year fixed terms.

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    OGG, I thought the federal rules only affected federal financial institutions though? So provincial credit unions can still offer 30 year CMHC-insured mortgages. Some provinces may already have rules in place to prevent this though.

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    Thanks Sampson, I will check that out!

  10. #10
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    Quote Originally Posted by Koala View Post
    OGG, I thought the federal rules only affected federal financial institutions though? So provincial credit unions can still offer 30 year CMHC-insured mortgages. Some provinces may already have rules in place to prevent this though.

    I've been reading the explanatory page on mortgage insurance, and it is as clear as mud. http://www.fin.gc.ca/n12/data/12-070_1-eng.asp

    On the one hand it initially says "The law requires federally regulated lenders to obtain mortgage insurance ....". This would seem to confirm your interpretation.

    But later it says: The measure announced today will reduce the maximum amortization period from 30 years to 25 years for high loan-to-value mortgages, which are backed by government insurance. .....

    And the page explains that the government backs both CMHC insurance and private mortgage insurers that compete with CMHC.

    This would appear to be independent of who the lender is.


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