Josee and Monique live in a small town in Eastern Ontario.  They are self-employed and the business earns about $120,000 in gross revenue. Their home is worth about $320,000 and they currently have a mortgage of $138,000 with a major bank.  Unfortunately, Monique has had health issues, undergoing cancer treatments for the last two years. She has no private insurance, so a lot of their costs have gone on credit.  They both ran the business, but Josee has taken on most of the work herself, reducing income to just one person.

Fortunately, Monique is now in remission and they need to address their debt, which sits at about $100,000. They need a new mortgage of $238,000, but due to the new rules, their bank will not refinance their mortgage because portfolio insurance is no longer available. The only way for them to refinance their debt is to go with a B lender at a higher rate and fees. So their only option is to pay the penalty, refinance at four per cent and then for the next two years, file enough income on taxes so that they can qualify at an A lending institution.