Raising the minimum down payment?? Federal Finance Minister
(Updated April 2019 - at this point in time, minimum down payment for a house remains 5% and maximum amortization is set at 25 years) Canada’s Minister of Finance [Dec 21, 2009] is concerned that homeowners are taking on too much debt and won’t be able to handle the higher payments that come with rising interest rates, or losses from falling home prices. His response may be to increase the size of the minimum down payment of 5% to a higher number (?10%?) and decrease the amortization period from 35 (?to 30?) years, which would serve to increase the monthly payment. Both would make it much harder for a first time buyer to enter the market and cool real estate prices that are overheating in some parts of the country. Industry observers are very concerned that this is a knee-jerk response to a problem actually caused by record-low interest rates, lowered in the first place to stimulate the economy.
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