When the sub-prime mortgage crisis battered the U.S. economy, Canadians felt safe that our banking practices were sound and that we couldn’t experience that type of crash here.
Apparently, we were wrong.
Up to 30,000 homeowners may face mortgage foreclosure over the next couple of years.
The reason?
Unfortunately, these are homeowners who didn’t qualify for prime mortgages. So they went the “non-traditional” route with lenders who approve higher risk mortgages. When it’s time to renew, those same lenders likely won’t approve those mortgages due to the fact that, just like in the U.S., they securitized the assets and lost a chunk of money – to the point where they couldn’t function properly.
So, for some, the Canadian version of the sub-prime mortgage crisis is looming.
