OSFI’s Rental Mortgage Update: The Truth Behind the Headlines
Marci Deane • October 6, 2025
The Buzz
Everyone’s been talking:
“You can’t use rental income to qualify anymore!”
“Investors are toast!”
Not true!
This isn’t a new rule about who can borrow.
It’s a change in how banks classify risk AND it’s mostly behind-the-scenes.
What OSFI Actually Said
OSFI (the federal banking regulator) told lenders:
“Don’t double-count borrower income when qualifying multiple properties.”
That means:
- You can still use personal income to qualify for a rental purchase.
- You just can’t reuse the same income that’s already tied up servicing another mortgage.
- If more than 50% of the income used to qualify comes from rent, that loan gets classified as income-producing (a.k.a. higher risk for the bank’s capital rules).
What This Means for Borrowers
- No direct rule change to how clients qualify today.
- Banks may adjust internal risk buckets.
- If anything, you might see a tiny rate bump (we’re talking 0.05%-ish).
- The change takes effect Nov 1 / 2025 for major banks.
So for now, no reason to panic, but we will be watching and waiting for lender clarification on policy changes, if any.
What Realtors Should Know
- Encourage clients to talk to a mortgage professional early! This is especially important if they own multiple properties.
- Some lenders may tighten up or add small buffers for rental income.
- Today it is still business as usual.
The Bottom Line
This isn’t a lending crackdown.
It’s regulatory housekeeping about how banks report risk.
- Borrowers can still buy rentals.
- Lenders can still lend.
- OSFI just wants cleaner math.
Big thanks to Rob McLister (Mortgage Logic News) for cutting through the noise and clarifying what this really means for our industry.
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