Canadian Mortgage Rules Act Change

As the change to the act, there will be no 40-year mortgage in Canada anymore. The maximum amortization period will be limited to 35 years. Also, 5% down payment will be required when purchasing a house/condo. The change will take effect on October 15.

This is a sign of credit tightening. Apparently, the federal government is worried about the similar sub-prime crisis might happen in Canada.(Just take a look at the real estate market in BC and AB) Will this change cool off the real estate market in Canada? I think only time can tell. But this is a correct decision to make. Good move for the federal government.