Industry players have complained about the glaring imbalance between uninsured (down payment equal or greater than 20%) and insured mortgages (down payment less than 20%) in the application of the stress test. Currently, the stress test is being applied to uninsured mortgages when the borrower switches to a different lender but this is not the case for insured mortgages.
This discrepancy has limited competition in the mortgage market, as borrowers with uninsured mortgages often cannot qualify with a new lender even if they've never missed a payment.
Removing the stress test for mortgage switches would allow more borrowers to shop for better rates and terms, increasing competition among lenders.
This change would be particularly beneficial for borrowers who purchased at higher prices and whose homes have not appreciated enough to maintain their original loan-to-value ratio.
While no official announcement has been made, industry advocates continue to push for this change to level the playing field and improve competition in the mortgage market.