OSFI proposes new minimum qualifying rate for uninsured mortgages

News Release

For Immediate Release

OTTAWA ─ April 8, 2021 ─ Office of the Superintendent of Financial Institutions

Today the Office of the Superintendent of Financial Institutions (OSFI) restarted its consultation on the minimum qualifying rate for uninsured mortgages, and re-emphasized the importance of sound mortgage underwriting.

The new proposal for the qualifying rate for uninsured mortgages is the higher of the mortgage contract rate plus 2% or 5.25% as a minimum floor. Additionally, OSFI announced a proposal to revisit the calibration of the qualifying rate at least once a year to ensure it remains appropriate for the risks in the environment.

A strong financial system that is able to support Canadians in today’s environment will be critical to Canada’s post-pandemic economic recovery. The current Canadian housing market conditions have the potential to put lenders at increased financial risk. OSFI is taking proactive action at this time so that banks will continue to be resilient.

The minimum qualifying rate adds a margin of safety that ensures borrowers will have the ability to make mortgage payments in the event of change in circumstances, such as the reduction of income or a rise in mortgage interest rates. As mortgages are one of the largest exposures that most banks carry, ensuring that borrowers are able to repay their loans strongly contributes to the continued safety and soundness of Canada’s financial system.

OSFI is seeking input from interested stakeholders on this proposed qualifying rate by email to B.20@osfi-bsif.gc.ca before May 7, 2021. OSFI will communicate final amendments to the qualifying rate for uninsured mortgages in Guideline B-20 by May 24, 2021, with a coming into force date of June 1, 2021.


Sound residential mortgage underwriting is always important for the safety and stability of financial institutions; today it is more important than ever.

—Jeremy Rudin, Superintendent

Quick Facts

On January 24, 2020, OSFI indicated that it was reviewing the benchmark rate (or floor) used for qualifying uninsured mortgages. This consultation was suspended on March 13, 2020 in response to challenges posed by the COVID-19 pandemic.

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About OSFI

The Office of the Superintendent of Financial Insititutions (OSFI) is an independent agency of the Government of Canada, established in 1987, to protect depositors, policyholders, financial institution creditors and pension plan members, while allowing financial institutions to compete and take reasonable risks.

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