# How does OSFI impact LTV and FRFI loan decisions?

> OSFI (Office of the Superintendent of Financial Institutions) sets guidelines for Financial Institutions (FRFIs) concerning mortgage underwriting, especially LTV ratios.

Category: Refinance
Last verified: 2026-02-18
Source: https://ratellow.com/faqs/refinance/how-does-osfi-impact-ltv-and-frfi-loan-decisions

## Answer
| Aspect                    | Description                                                                                                                                 |
|---------------------------|---------------------------------------------------------------------------------------------------------------------------------------------|
| **LTV Ratio Frameworks**  | FRFIs should establish and maintain maximum LTV ratio limits for different mortgage types.                                                 |
| **Dynamic LTV Ratios**    | OSFI expects FRFIs' LTV ratio frameworks to be regularly reviewed and updated to reflect current market conditions.                             |
| **LTV Recalculation**    | LTV should be recalculated upon refinancing or if there are changes in the borrower's risk profile.                                        |
| **Property Value Risk**   | FRFIs should assess and adjust property value, considering factors like location, market trends, and potential price corrections when calculating LTV. |

## Institutional highlights
- Lenders have limits on how much they can loan you based on the value of your home.
- These limits can change, so lenders regularly review them.
- If you refinance or your financial situation changes, your loan-to-value ratio will be recalculated.
- Lenders consider location and market trends to estimate your home's value when deciding on your loan.

## Related guide
- https://ratellow.com/guides/refinancing-for-renovations

## Sources
- Page 3 — https://assets.cmhc-schl.gc.ca/sf/project/cmhc/pdfs/factsheets/new/cmhc-quick-reference.pdf#page=3
- Page 2 — https://assets.cmhc-schl.gc.ca/sf/project/cmhc/pdfs/factsheets/new/cmhc-quick-reference.pdf#page=2
- Footnotes — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/capital-adequacy-requirements-car-guideline-2026
- LTV Ratio Frameworks — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-2017#2.4.3