What this means for borrowers
For borrowers with uninsured mortgages approaching renewal, this change eliminates a significant obstacle.
Without the stress test, borrowers will be able to shop around for better rates without the risk of being disqualified, potentially easing the financial strain in a higher-rate environment.
“This is all about fairness to borrowers,” Ron Butler of Butler Mortgage told CMT. “It never made any sense to apply a stress test on a renewal,” he added, noting that the current lender wouldn’t even typically check if the borrower is still employed at the time of renewal. New lenders, however, fully underwrite switch mortgages, making the stress test redundant in these cases.
“This makes getting a better rate at renewal more possible,” he said.
Lauren van den Berg, CEO & President of Mortgage Professionals Canada (MPC), agreed, emphasizing how important this policy change is for homeowners, calling it a “significant win for Canadians.”
“This change ensures that homeowners can secure the best rate that fits their financial needs without unnecessary barriers, giving them greater choice and flexibility,” she said. “It also encourages healthy competition among lenders, leading to better options for borrowers.”
MPC had long advocated for the removal of the stress test on uninsured mortgage renewals, and the association is “thrilled to see it come to fruition,” van den Berg added, noting the change will support a more balanced and competitive market for homeowners across Canada.