Linda C. was getting out of a bad relationship in 2014 and needed to find a place to live in Medicine Hat. She was in her early 40s, and owned her own home previously, so she bought what she thought would be a nice condo. Two years later, she contacted a mortgage broker to look at her options for moving to a small home. Condo living was not for her; the units are mostly rentals and the property management company has been unresponsive to her complaints.

Fortunately, her job as a pharmacy technician stabilized and her earnings averaged $48,000 annually. She has excellent credit and is carrying a normal debt load for her life stage.  Unfortunately, due to the marketability of units in her building, she will most likely have to sell at a loss and obtain a gifted down payment from her parents.

To qualify for a mortgage on a small house in the price range of $200,000 is not possible with the new stress test mortgage guidelines. Even though there are a handful of properties in the range of $175,000, she feels she needs to purchase a solid property or would be making the same mistake over again.

The end result is that she will have to remain where she is or sell the property and rent until some of her debt is cleared, her income increases dramatically, or there is a life event change for her.