Under OSFI Guideline B-20, what minimum qualifying rate must federally regulated lenders use when qualifying borrowers for uninsured mortgages?
Correct Answer
B) The greater of contract rate plus 2% or 5.25%
OSFI's minimum qualifying rate for uninsured mortgages is the greater of the mortgage contract rate plus 2% or 5.25%. The 5.25% floor is set by OSFI and has replaced the Bank of Canada five-year benchmark rate that was used before June 2021. OSFI expects federally regulated lenders to apply this rate through Guideline B-20.
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