Canada makes it easier for mortgage borrowers to switch lenders By Reuters

(Reuters) – Canada’s banking regulator said on Wednesday it will make it easier for borrowers to switch banks when they renew their mortgages, scrapping a rule that industry players have long lobbied against.

Most mortgages have terms of five years or less, compared to the 30-year term that is the norm in the United States.

It is common practice to switch lenders in search of improved interest rates, but without changing the repayment amount or schedule – the so-called direct switch.

Starting Nov. 21, borrowers will no longer have to prove income meets the Minimum Qualifying Rate when seeking a direct change.

The change will increase lending options for borrowers who need to renew at higher interest rates than those prevailing in the lower interest rate environment of recent years.