Office of the Superintendent of Financial Institutions
This Advisory defines the total requirements for First-Time Home Buyer Incentive insured mortgages (FTHBI mortgages) and complements OSFI's Mortgage Insurer Capital Adequacy Test (MICAT) Guideline.
The requirements included in this Advisory are effective November 1, 2019.
The base total requirements and supplementary capital requirements for FTHBI mortgages are calculated using the general method specified in MICAT section 3.1 and the following specifications for defining the loan-to-value ratio, in lieu of MICAT section 188.8.131.52.
The reciprocal of loan-to-value input for FTHBI mortgages is represented formulaically below:
If a borrower pays back the shared equity amount while the mortgage is still in-force, then the shared equity amount component above is equal to zero and the total requirements for the mortgage should be the same as if it were calculated as specified in the MICAT without regard for this advisory.