Tim G. is a teacher living in Sudbury. He reached out to a mortgage broker last summer about a pre-approval, but unfortunately because he is a contract teacher, his 2014/2015 average income didn’t qualify to purchase anything in his market.
He had a game plan to get into a home and forecasted his income to be about $50,000 for 2015/2016, which would qualify him for a $300,000 house. Unfortunately, after the changes to the mortgage rules and restricted amortization, his pre-approval amount dropped to $230,000.
Tim will have to wait another 12 months to qualify for the $300,000 mortgage. In that time, the cost of buying a place he wants will likely increase beyond the $300,000-mark in which he was trying to qualify.