Guiding you forward
On February 1, 2017, I testified before the House of Commons Standing Committee on Finance about the mortgage rule changes Ottawa had just imposed. I went with three recommendations, drawn from what I was watching happen to real clients.
Seven years later, the federal government enacted two of them.
I’m not claiming credit for federal policy — a great many people made the same arguments, and the industry associations carried them further than I did. What I’d point to instead is simpler and more useful to anyone choosing a broker: the analysis held up. The things I said would hurt Canadians did hurt them, for seven years, until they were reversed.
The full transcript is a public parliamentary record. You can read every word of it on the House of Commons website.
The hearing was Meeting 68 of the Standing Committee on Finance, 42nd Parliament, chaired by the Hon. Wayne Easter, during its study of the Canadian real estate market and home ownership.
The subject was the package of changes the Minister of Finance had enacted on October 3, 2016. The one that hit hardest was the standardisation of eligibility criteria across high- and low-ratio insured mortgages, including a mortgage rate stress test.
The changes arrived without warning and, as far as anyone in the industry could tell, without consultation. That was the first thing I told the committee. Nobody I knew had been asked anything at all. The other witnesses said the same. An entire industry that arranges mortgages for millions of Canadians learned about the rules the way the public did.
I read the government its own words on that point. Page 36 of the Liberal Party’s platform states that government should base its policies on facts rather than making up facts to suit a preferred policy — that common sense, good policy, and evidence about what works should guide the decisions government makes.
The government did nothing to find out from the industry what the long-term effects would be. My warning to the committee was specific: by rushing the changes through without researching their impact, they had damaged the competitive nature of the industry, tilted it in favour of one group over others, and the result would be more expensive lending for all Canadians.
At the time I was running DLC Canadian Mortgage Experts — 130 brokers, 3,800 mortgages the previous year, $1.36 billion in volume. That’s not a boast; it’s why I was in the room. When you’re seeing that many files, you stop arguing from theory. You argue from the pile of people in front of you who no longer qualify.
I didn’t bring statistics. I brought files.
A family in North Vancouver with a $250,000 mortgage coming up for renewal. A modest mortgage on a home they’d owned for years. But the house had since been assessed at over a million dollars, which under the new rules made it uninsurable — so they faced a higher rate on any term they chose. They hadn’t borrowed more. They hadn’t missed anything. Their neighbourhood appreciated, and they were penalised for it at renewal.
A man in the Kootenays, separated from his wife since the previous spring, working through a separation agreement. The plan had been to buy her out of the matrimonial home — an ordinary, sensible resolution that keeps a family in a house. Under the new rules he no longer qualified. The home had to be sold.
Nothing about that man’s finances had changed. He hadn’t lost his job or missed a payment. A rule written to cool Toronto and Vancouver forced the sale of a house in the Kootenays.
And first-time buyers, plural, who had spent years assembling a down payment and were now revising their expectations downward — from houses to townhouses, from townhouses to condos. With amortizations capped at 25 years, their buying power shrank again.
Those aren’t edge cases. They were the ordinary weekly business of a brokerage doing 3,800 files a year.
Something worth recording: the consultation question didn’t end with our answers.
Later that afternoon, a member of the committee moved that the Minister of Finance be invited to appear and explain how the policy had been developed. In the debate that followed, one member observed that officials had given no answer as to how the policy was made, and that the committee had then heard a series of witnesses saying there had been no consultation. A government member disputed that characterisation.
The motion carried. The committee voted to summon the minister.
I don’t overstate what that means — committees invite ministers all the time. But it does establish something a reader can check: the witnesses that day, myself included, said plainly that an entire industry had been bypassed, and the committee found the question serious enough to put to the minister directly.
Three things:
That was it. Three specific, unglamorous changes.
The objection to 30-year amortizations is that they keep people in debt longer. It sounds responsible. It isn’t what happens.
What I told the committee is that a longer amortization lowers the entry payment, which is what gets someone through the door. From there, payments rise as income does. A 30-year amortization does not mean a 30-year mortgage — switch to accelerated biweekly payments and you take nearly four years off it immediately, without any dramatic sacrifice.
Most of my clients never took the full term. We push them to make extra payments, and they do.
So the mechanism being removed was a simple one that let people in earlier and, in practice, cost them very little. Take it away and you don’t create disciplined borrowers. You create renters, competing for rental stock that isn’t growing either, which pushes rents up for everyone who didn’t buy.
This is the part I’d still argue hardest.
The 2016 changes were aimed at Vancouver and Toronto. They were applied to the entire country. My view then, and now, is that they weren’t especially effective in Vancouver and Toronto either — but they landed with full force on every other market in Canada, where affordability was never the problem being solved.
What I told the committee was that you end up bludgeoning everyone, and it doesn’t fix anything.
CMHC’s long-standing position has been that policy should be national, never regional. I said those days should change — that different parts of the country are living in genuinely different situations and deserve policy that recognises it. A rule calibrated for a Vancouver market should not be deciding whether a separated man in the Kootenays can keep his house.
That one hasn’t been fixed either.
The 2016 rules also cut off insurance on refinances, which quietly removed most non-bank lenders from that market. The practical effect was that homeowners who had spent years building equity could no longer access it except through a big bank, usually at a higher rate, from a shrinking pool of options.
That matters more than it sounds. Refinancing is how a great deal of ordinary economic activity gets funded — people start businesses with it, expand businesses with it, and buy rental properties with it. Restricting it doesn’t just inconvenience homeowners; it takes capital out of the economy.
And on rentals specifically: after the changes, buying a rental property meant 20% down and a bank. Before them, there were non-bank lenders with a range of policies. Removing that competition didn’t produce better landlords. It produced fewer rental units at a moment when rental supply was already the problem.
Nothing, for seven years.
Then, in 2024, the federal government enacted two of the three.
Thirty-year amortizations came back. Budget 2024 permitted them for first-time buyers purchasing new builds, effective August 1, 2024. On December 15, 2024, that expanded to all first-time buyers and all purchasers of new builds. The government described the package as the most significant mortgage reforms in decades.
The $1 million insured mortgage cap was raised to $1.5 million, also effective December 15, 2024 — the first change to that ceiling since 2012. The stated reason was that home prices in major centres had moved well beyond $1 million and the program needed to reflect reality.
Both were things I asked for in 2017, for the reasons I gave in 2017. You can read what’s available now on our guide to first-time buyer programs in BC.
The third — the restrictions on rental property investment — is still in place. Rental supply is still a problem. That argument is still waiting.
Testifying before a parliamentary committee isn’t a qualification. Plenty of excellent brokers have never been near Ottawa, and plenty of poor ones have opinions about policy.
What it does tell you is something narrower and more checkable: when the rules change, I’ve spent a long time thinking about why, who they were aimed at, and who they actually hit. That’s not academic. It’s the difference between a broker who tells you what the rule is and one who can tell you how it will behave on your particular file — where the exceptions sit, which lenders read it differently, and whether waiting three months changes the answer.
It also means I’ll tell you when a rule is doing something other than what it was advertised to do. I said it to a House of Commons committee on the record. I’ll say it to you across a video call — including on questions like fixed versus variable, where the conventional advice and the arithmetic don’t always agree.
On February 1, 2017, before the Standing Committee on Finance — 42nd Parliament, Meeting 68, chaired by the Hon. Wayne Easter — during its study of the Canadian real estate market and home ownership. I appeared alongside other industry witnesses. At the time I was leading DLC Canadian Mortgage Experts, with 130 brokers and $1.36 billion in annual volume. The full transcript is a public parliamentary record.
Three changes: allow 30-year amortizations, stop restricting investment in rental properties, and remove the $1 million cap on insurable mortgages.
Two of the three, in 2024. Thirty-year amortizations returned for first-time buyers and buyers of new builds, effective August 1 and expanded December 15, 2024. The insured mortgage cap rose from $1 million to $1.5 million on December 15, 2024 — its first increase since 2012. The rental investment restrictions remain in place.
No. Many people argued the same case, and industry associations pushed it far harder than any individual broker could. The point isn’t authorship; it’s that the analysis proved correct over seven years, which is a reasonable thing to weigh when you’re deciding whose read on the rules to trust.
Not as far as any witness in that room could establish. I told the committee that nobody I knew had been asked anything about the changes, and the other witnesses said the same. Later in the same meeting, the committee voted to invite the Minister of Finance to explain how the policy had been developed.
Applying a national rule to a regional problem. The changes were aimed at Vancouver and Toronto, weren’t especially effective there, and did real damage everywhere else — including to people whose finances hadn’t changed at all.
If a rule has knocked your plans sideways, the useful question isn’t what the rule says. It’s how it behaves on your specific file, and whether another lender reads it differently.
Call or text 604-833-4663 (HOME) or book a free, zero-pressure strategy session.
About the author: Michael Lloyd has been in mortgage lending since 1988 and a licensed mortgage broker since 1999 (BCFSA licence #087740). He founded and led DLC Canadian Mortgage Experts to over $1.8 billion in annual mortgage volume before returning to full-time client work. Michael leads The HomeHappy Team @ Canadian Mortgage Experts, co-brokering under Indi Mortgage, serving homeowners across British Columbia with strategy-first mortgage planning and lifetime mortgage management. In 2017, he testified before the House of Commons Standing Committee on Finance on Canada’s mortgage rules — two of his three recommendations became federal policy in 2024.
