New Pillar Policies for Mortgage Lending

Blog-Date-1May 21, 2020

The Canadian economy has seen significant upheaval in recent months, disrupting operations for countless businesses and leading to layoffs or reduced hours for millions of Canadians. As the mortgage industry has been deemed essential, Pillar has continued to operate with minimal disruption, helping brokers like you secure mortgages for your clients. However, we recently introduced three important changes in our lending policies to reflect current market conditions.

Lower LTV depending on the type of appraisal

Some appraisal firms in Ontario are prohibiting their appraisers from entering homes, so they are currently limited to external inspections. In these cases, the appraisal is being supplemented with photos and videos of the inside of the home provided by the homeowner.

For mortgage applications where an exterior-only appraisal is provided (together with interior photos and videos from the homeowner), we have reduced our maximum loan-to-value (LTV) ratio to 75%. For full appraisals, our maximum LTV remains at 80%.

approved appraiser

DOWNLOAD: Pillar’s Approved Appraiser List

New requirement for updated salary letters

To better align our mortgage terms with your client’s financial situation, we now require an updated salary letter if your client is currently employed. The letter should be recent and include details about where your client is working, how long they have worked there and what they are earning at the moment.

Holdbacks during temporary unemployment

We recognize that many Canadians are out of work as employers across the country have cut staff and implemented temporary layoffs. If your client is not working currently, we may restructure a deal to include a three-month or six-month holdback in order to reduce their mortgage payments.

These new policies reflect our ongoing commitment to providing flexible, solution-based mortgages during the pandemic. As always, our goal with any Pillar mortgage is to help the borrower with transitional financing so they can end up in a better position.

If you have any questions about these new policies or would like to discuss a prospective deal, please contact our business development team.

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