February 29, 2024
1 In 7 Canadian Mortgage Balances Are Growing (Negative Amoritization)
What is a mortgage that has a “negative amortization"?
In 2008 this would be called a mortgage default, and this new definition of “negative amortization” is an attempt not to panic the markets.
These numbers are aligned to the fact that 19.6% of all Canadian renters were in arrears according to the CHMC (Canadian Mortgage Housing Corporation) : https://www.one-receipt.com/media/interesting-facts/196-of-all-canadian-renters-were-in-arrears-in-2023
Direct Quotes from the article :
- BMO had mortgages worth $23-billion in negative amortization in the first quarter, representing 15 per cent of its Canadian residential loan book.
- TD had mortgages worth $33-billion in negative amortization in the first quarter, comprising 13 per cent of its domestic residential loan book.
- CIBC had $38.1-billion in negative amortization in the first quarter, accounting for 14 per cent of its Canadian residential mortgage book.
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ARTICLE SOURCE : https://www.theglobeandmail.com/business/article-canada-banks-mortgages-negative-amortization/