Has the Stress test for Mortgages kept you out of the housing market? Great news... For the first time since 2016 we are seeing a decline in the interest rate that has been used for this test. Get in touch with your mortgage specialist to see these changes make a difference.
"The interest rate used by the federally regulated banks in mortgage stress tests has declined for the first time since 2016, making it a bit easier to get a mortgage. This is particularly important for first-time homeowners who have been struggling to pass the B-20 stress test."
According to Rate Spy, for a borrower buying a home with 5% down, today’s drop in the stress-test rate means:
- Someone making $50,000 a year can afford $2,800 (1.3%) more home
- Someone making $100,000 a year can afford $5,900 (1.3%) more home
(Assumes no other debts and a 25-year amortization. Figures are rounded and approximate.)
For a borrower buying a home with 20% down, today’s drop in the stress-test rate means:
- Someone making $50,000 a year can afford $4,000 (1.4%) more home
- Someone making $100,000 a year can afford $8,300 (1.4%) more home
(Assumes no other debts and a 30-year amortization. Figures are rounded and approximate.)
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