Canada Real Estate - Mortgage Lending Scenario

Closely associated with the real estate market of Canada is the mortgage lending industry of the country. So, it is important to throw some light about the mortgage lending scenario at Canada. This will help in gaining a better understanding of various aspects of the real estate market of Canada and that of its provinces like Alberta.

Features of the mortgage industry of Canada

There is a well developed mortgage market in Canada- regulated by the monetary policy established by the Central Bank of Canada. The provincial governments in Canada enforce the laws governing the mortgage industry. These are especially those that are related to the mortgage brokers.

The Canada Mortgage and Housing Corporation (CMHC) is the national housing agency established by the Canadian government. It endeavors to offer a range of housing options to the people of Canada. Providing of mortgage loan insurance is a special feature of the CMHC. It is via this insurance policy that the CMHC provides insurance to approved lenders against borrower default. This also makes available low rates of interest for a wide range of customers.

It may be noted that in Canada you are not allowed to obtain self certification mortgages. For getting approved and securing mortgages it is necessary to provide documentary evidence of your income and credit status. The banks, credit unions and other credit granting companies are the institutions lending mortgages.

The CMHC requires payment of a minimum of 5% of the purchase price of the house (real estate) as down payment. Further, the lenders demand payments for mortgage premiums too when you are making a contribution of less than 25% of the purchase price as down payment.

Updates on mortgage lending in Canada

A new legislation is in the offing regarding the Canada mortgage industry. This is the Mortgage Brokerages, Lenders and Administrators Act. It has been proposed by the Ontario Finance Minister. This law concerns setting up of a multi leveled registration system for brokers and agents. There has been laid emphasis on the need for qualified brokers or agents to be a part of the mortgage industry. As per this law the brokers ought to have necessary educational qualifications to carry out with their services and should be making suitable disclosures regarding the mortgage transactions.

A growth of 10% has been recorded in 2005 in the Canadian mortgage industry. This is expected to grow at a similar rate in 2006 too. The reason for such growth of the mortgage industry can be attributed to the fact that there has been an increase in the number of qualified professionals in the mortgage market.

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Jason Uvios writes about on Canada Real Estate - Mortgage Lending Scenario to visit :- alberta homes for sale, homes for sale calgary alberta and homes for sale calgary alberta

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