Quote:
Originally Posted by Bill Bumface
Yet. I don't think we've seen the effects of that unwind, I think it's coming at some unknown point in the future.
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I think we're past whatever it was going to cost. In Canada they're effectively dead. CMHC stopped insuring them 12 years ago, which means the highly leveraged ones have had a long time to build actual asset value. Now you need 20% down to get one.
I'm not 100% sure about the US details, but 40 year mortgages there are non-qualified and the lowest I can find is 10% down payment.
As long as the fundamentals behind giving out the mortgages are there (ex: debt service ratio), there's nothing inherently toxic about a 40 year mortgage from an overall economic health standpoint. They're just not widespread enough.