Jean Richer & Irene Bilinski
Bilingual Sales Representatives

Evolution of the Canadian Mortgage Market

In the last few decades, the mortgage market in Canada has changed a great deal. Historically, most mortgages required at least a 25% down payment. Mortgages were granted only by banks and a prospective homeowner who shopped around for a mortgage at different financial institutions was viewed negatively by the lenders. Many members of older generations still embrace this view and believe that it is much tougher to get a mortgage than it actually is.

The Canada Mortgage and Housing Corporation (CMHC) was created in 1946 to assist Canadian soldiers returning from World War II enter the real estate market. Realizing that few younger couples had the savings to provide a 25% or higher down payment, the CMHC guaranteed the financial agencies that gave mortgages that the loan would be repaid, even if the borrower defaulted. In the decades following, more lenders began to grant mortgages. This new mortgage market created the need for specialist mortgage brokers, mostly former bankers or real estate agents.

In the last ten years, mortgages have become much easier to access and more diverse. Local culture is still a factor, so an Ottawa mortgage lender may have slightly different qualifying requirements than one in a neighbouring province. This is why an Ottawa mortgage broker may be a better option for more marginal borrowers, as they access hundreds of lending agencies across Canada. It might still be possible to buy a house with a zero down mortgage, and five and ten percent down mortgages are more common. Also, small business owners now have many more mortgage options than they used to.

If you have additional questions or would like to see if you can prequalify for a mortgage in Ottawa you can use our Ottawa Mortgages Directory to find a mortgage broker or mortgage bank specialist to help you.