As mortgage deferral rules tighten, expert warns it’s time to assess ability to pay
Posted September 1, 2020 12:43 pm.
Last Updated September 1, 2020 1:54 pm.
VANCOUVER (NEWS 1130) — They were a massive relief for many of us dealing with the financial uncertainty brought on the COVID-19 pandemic.
But mortgage deferrals are going to be harder to get, thanks to regulatory changes the Office of the Superintendent of Financial Institutions is bringing in.
And this means it’s time to have tough conversations about your ability to resume mortgage payments.
“They should be prepared for how they’re going to manage their mortgage payments going forward,” says Sabeena Bubber, a director with the Canadian Mortgage Brokers Association of BC.
“It’s uncertain as to whether they’ll be able to get additional deferrals beyond the current deferral period, and going forward there really have to be a plan in place, for if I don’t get that deferral, what does that mean for me. Should I be finding a source of income so I can make those mortgage payments, or should I be putting my house on the market. All these things have to be considered.”
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Bubber says there’s a possibility you can negotiate a longer repayment period — but some people might have to sell.
“It’s a very difficult decision to move and to have to give up your home,” says Bubber. “Especially when we work so hard to get into our homes, especially in Vancouver, the cost of living and everything like that. And the thought of moving to renting and the challenge with rental supply, it’s definitely a difficult decision.”
Bubber said it’s important to understand is that if you start missing mortgage payments, it’s reflected on your credit bureau.
“And when it’s on your credit, it’s there for a period of seven years. It will prevent you from getting any future mortgages, even if you have one missed mortgage payment.”
