How do Loan-to-Income (LTI) limits factor into the straight switch process?
LTI limits don't directly affect individual borrowers but influence how lenders manage their overall mortgage portfolios to control risk.
OSFI introduced LTI limits to reduce risks linked to high household debt levels within lenders' mortgage portfolios.
Key Points
Lenders have limits on how much they can loan compared to borrowers' incomes.
These limits don't directly affect your ability to get a mortgage or switch lenders.
Lenders need to follow these rules starting in early 2025.
The government will monitor these new rules to see if they're working as intended.
These limits help protect lenders from risk related to high levels of debt.
Primary sources
Primary sources cited by the Ratellow Research Team. Editorial standards · Correction policy
Related Questions
How does the stress test affect my 2026 renewal options?
Same-lender renewals and uninsured straight switches (OSFI, November 21, 2024) are exempt from the prescribed MQR. A refinance, an insured switch, or any increase in loan amount still requires the stress test — greater of 5.25% or contract + 2%.
What's the difference between insured and uninsured mortgage renewals?
Insured mortgages face stricter CMHC/Sagen constraints while uninsured mortgages enjoy flexible OSFI-only guidelines.
Should I consider switching lenders or negotiate with my current lender?
Your switching decision hinges on rate differential versus requalification risk, with break-even analysis determining optimal strategy.
When should I start my mortgage renewal process?
Start your renewal process 120-180 days before your current term expires to maximize your strategic options.