On June 21, 2012 The Honorable Jim Flaherty, Minister of Finance, announced four measures for new government-backed insured mortgages with loan-to-value ratios of more than 80 per cent:
- Reduce the maximum amortization period to 25 years from 30 years.
- Lower the maximum amount Canadians can borrow when refinancing to 80 per cent from 85 per cent of the value of their homes.
- Fix the maximum gross debt service ratio at 39 per cent and the maximum total debt service ratio at 44 per cent.
- Limit the availability of government-backed insured mortgages to homes with a purchase price of less than $1 million.
This new rules were effective from July 9, 2012.