TORONTO—A new stress test for all uninsured mortgages is unnecessary and could increase costs for homebuyers, a report by the Fraser Institute said Wednesday. Study author Neil Mohindra wrote that the proposed stress test “will do more harm than good” by limiting access to mortgages for some homebuyers. “The mandatory standard for stress testing could result in a less competitive and more concentrated mortgage market,” he wrote in the report. However, Mohindra said that instead of a prescriptive test, OSFI could use its existing powers to fix what it believes are deficiencies in policies and procedures. The increases have pushed up the big bank prime lending rates, which are used to determine rates for variable-rate mortgages and lines of credit.

Source: thestar October 11, 2017 17:48 UTC