Canada's Financial Consumer Agency (FCAC), which supervises federally regulated financial entities, has proposed new guidelines that will permit lenders to offer relief to homeowners struggling to pay mortgages with variable rates.
The relief will include an extension of the amortization period on these loans, enabling homeowners to move several payments to the back of the mortgage—extending the window for paying the loan back—with no penalties charged.
In Canada, the maximum amortization period for borrowers who make a down payment of less than 20% is 25 years; borrowers who make a down payment of 20% or more can expect a maximum amortization of 30 years.
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