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Originally Posted by bizaro86
Gotcha, sorry. I think the best way keep things rational would be to tight standards on how much mortgage people can qualify. Don't necessarily make joe and jane average come up with more than 5%, but maybe their average Calgary income should only qualify for a 400k mortgage instead of a 500k mortgage. That also helps affordability in the future if interest rates pop up, and doesn't keep most people out of the market completely, just restricts the cost of what they can buy.
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Yup, sensible leading is the best way to go. However, sadly the banks need someone to make them do it as one isn't going to give up the business on it's own. CMHC is there to back up the banks so they just fill out the paper and cross their T's, dot their I's and push it out the door.
That's where you get into the debate about changing CMHC and the government interfering. I just thing they're going about it the wrong way and or after the wrong segment of the lending market.
I guess maybe they don't go after the CC's or the personal lines as the government doesn't have any in or out other than OSFI whereas CMHC is something they can control. CMHC doesn't get involved in direct lending on HELOC's and purchases under 80% however the banks can still go and buy the insurance in bulk on large amounts of mortgages they hold.