005: Gord Appel Gives Tips for Adjusting to Recent Mortgage Rule Changes

Tanya Appel talks with Gord Appel, Vice President – Broker of Record of TMG The Mortgage Group Canada, Alberta region. They discuss how the recent 2016 mortgage rule changes have affected the Canadian market.


Gord Appel is the Vice President – Broker of Record of TMG The Mortgage Group in the Alberta region. Gord is the past president of the Alberta Mortgage Brokers Association (AMBA), two-time name recipient of Canadian Mortgage Professional’s Magazine’s Hotlist, and current sitting member of Alberta’s 2020 real estate council.

Gord discusses how the recent mortgage rule changes have affected the real estate market in Canada, also providing insights and tips for brokers seeking to adjust amidst the current trends.


Key Points

  • [1:04] Touch on the recent mortgage rule changes and how these have impacted the lending environment and those looking to borrow.
  • [1:56] What is different about the new stress test?
  • [2:08] There is now a different qualifying rate.
  • [2:47] How do these relate to discounted rates?
  • [3:13] What has changed for stress tests since the new rules?
  • [4:04] Rates are as low as they are likely to get.
  • [4:38] The announcement prevents overexposure to the system and taxpayers to the defaults.
  • [4:59] What is the role of the taxpayer in this situation?
  • [5:57] Default insurance ensures the lender is able to recover their outlay of initial principle and any earned interest.
  • [6:31] Canada’s market is much different than in the US.
  • [7:33] What is benchmark? How do the banks reach this number?
  • [8:09] The benchmark creates a buffer rate on a term.
  • [8:42] Why is this benchmark rate used?
  • [9:12] Why is this used across the board, regardless of term?
  • [10:29] The qualifying rate is not your monthly payment.
  • [10:36] Can you touch on closing the tax loopholes for capital gain exceptions on principal and owner-occupied residences.
  • [12:57] What insights do you have on lender risk sharing and the upcoming changes?
  • [14:18] What are the current thoughts amongst brokers in Canada?
  • [15:14] Brokers are busy and finding solutions.
  • [15:33] What other changes have you seen in the recent market? Why are the rule changes unique?
  • [17:13] The most recent changes often seem the most pressing.
  • [18:51] What does it mean when competition increases or decreases in the business?
  • [20:15] What else would you like to add for the average homeowner?
  • [21:12] Consult with a trusted expert.