Canada mortgage market has witnessed the entry of many new lenders and also several new products in the country. The mortgage rates in Canada may be fixed or variable. However, about 2/3rd of mortgage loans have fixed mortgage rates in Canada. The loans are amortized for a duration of 30 years. The write up below throws light on the same.
Canada mortgage market is doing quite well, even though the people of Canada adopt a very "conservative" approach as compared to the United States of America. Majority of the rates of mortgage are fixed. The CMHC, which functions as Canada's financial agent looks into matters associated with mortgage in Canada.
Canada Mortgage Housing Corporation or CMHC:
The CMHC or the Canada Mortgage Housing Corporation is responsible for monitoring the various activities in the housing sector in the country. The CMHC or the Canada Mortgage Housing Corporation was mainly set up to provide a dwelling place for the veterans returning after World War II.
Impact of US Subprime mortgage crisis in Canada:
Reports reveal that price appreciation pertaining to the housing market in the United States of America in the past two years was artificially induced, characterized by "aggressive lending" as well as "irresponsible borrowing". In comparison to USA, the Canadian housing market has remained rather passive in the last couple of years. As per CAAMP or Canadian Association of Accredited Mortgage Professionals, it has been observed that the subprime market in Canada constitutes 5% of all mortgage loans as compared to 20% in the United States of America. Even then there was not much activity in the Canada mortgage market, but the industry has been able to maintain its steadfastness. As a result, the mortgage market in Canada has not been affected by the mortgage crisis in America.