Fifteen-plus years of BC mortgage experience, distilled into practical writing on buying, renewing, refinancing, and building wealth through real estate.
200 Basis Points or 2%: What OSFI's Qualifying Rate Update Means for You
A basis point is one hundredth of one percentage point, so 200 basis points (a term lenders use to mean hundredths of a percent) and 2% describe exactly the same distance. That small piece of arithmetic explains the latest wording of OSFI's stress test for uninsured mortgages.
Two phrasings, one rule
OSFI, the federal regulator for banks, sets a minimum qualifying rate for uninsured mortgages. Canadian Mortgage Professional reported on January 29, 2026 that the rule was the contract rate plus 2 percentage points or 5.25%, whichever is greater. OSFI's own page, as of September 25, 2026, describes it as 5.25% or the contract rate plus 2%, whichever is higher. That page applies the same test to refinances.
The math is unchanged. A file that qualified under the old wording qualifies under the new one, and a file that fell short still falls short.
How the test works on a real file
The lender takes the rate you are offered, adds 2 percentage points, and compares the result to 5.25%. You have to show you could carry payments at whichever number is higher. For an uninsured buyer in Armstrong offered 4.5%, the qualifying rate is 6.5%. If the offer were 3%, adding 2 points gives 5%, so the 5.25% floor applies instead.
The floor does its work when offered rates are low. It keeps the test from shrinking every time a lender advertises a discount.
Where negotiation still counts
The buffer sits a fixed two points above your contract rate, so every fraction you negotiate off the offered rate also comes off the qualifying rate, at least until you reach 5.25%. A quarter point off the contract rate lowers the stress-test rate by a quarter point, which can raise the amount a lender will approve without any change to your income, debts, or down payment. Below the floor, that link breaks. Further rate cuts still lower your monthly payment, but they no longer raise your borrowing limit.
The update leaves the stress test where it was. What still moves your approval is the rate you negotiate and how close it sits to the 5.25% line beneath it.
A basis point is one hundredth of one percentage point, so 200 basis points (a term lenders use to mean hundredths of a percent) and 2% describe exactly the same distance. That small piece of arithmetic explains the latest wording of OSFI's stress test for uninsured mortgages.
Two phrasings, one rule
OSFI, the federal regulator for banks, sets a minimum qualifying rate for uninsured mortgages. Canadian Mortgage Professional reported on January 29, 2026 that the rule was the contract rate plus 2 percentage points or 5.25%, whichever is greater. OSFI's own page, as of September 25, 2026, describes it as 5.25% or the contract rate plus 2%, whichever is higher. That page applies the same test to refinances.
The math is unchanged. A file that qualified under the old wording qualifies under the new one, and a file that fell short still falls short.
How the test works on a real file
The lender takes the rate you are offered, adds 2 percentage points, and compares the result to 5.25%. You have to show you could carry payments at whichever number is higher. For an uninsured buyer in Armstrong offered 4.5%, the qualifying rate is 6.5%. If the offer were 3%, adding 2 points gives 5%, so the 5.25% floor applies instead.
The floor does its work when offered rates are low. It keeps the test from shrinking every time a lender advertises a discount.
Where negotiation still counts
The buffer sits a fixed two points above your contract rate, so every fraction you negotiate off the offered rate also comes off the qualifying rate, at least until you reach 5.25%. A quarter point off the contract rate lowers the stress-test rate by a quarter point, which can raise the amount a lender will approve without any change to your income, debts, or down payment. Below the floor, that link breaks. Further rate cuts still lower your monthly payment, but they no longer raise your borrowing limit.
The update leaves the stress test where it was. What still moves your approval is the rate you negotiate and how close it sits to the 5.25% line beneath it.
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