As instances of title fraud repeatedly make the headlines, nearly one-third of Canadians have become concerned that someone could sell their home without their knowledge.

The anxiety was felt by 29% of respondents to a recent fraud prevention survey from Equifax; others worried that identity thieves could take out cash using their home as an asset, or take out a loan using their mortgage information.

Nearly half of those surveyed see mortgage fraud as a growing problem in Canada, and 37% feel they're currently at a greater risk of falling victim to such a crime than ever before.

Since the start of 2023, a number of homes in the Greater Toronto Area changed hands without the knowledge or consent of the legal homeowner. A similar scenario is playing out in the rental landscape, with hopeful tenants unknowingly handing over substantial deposits to scammers.

Thirty-percent of respondents to Equifax's survey believe there will be an increase in people providing false information on mortgage financing applications over the coming year, and 37% believe the same regarding rental applications. Over one-third feel vulnerable to such types of fraud.

Mortgage payments have grown increasingly expensive over the past year as interest rates rose rapidly. With affordability dwindling, a record-high number of Canadians don't think they'll ever be able to buy a home, and nearly one quarter say they've been prevented from doing so by the mortgage stress test.

In December, the Office of the Superintendent of Financial Institutions (OSFI) opted to maintain the qualifying rate for its mortgage stress test (your rate +2% or 5.25%, whichever is higher). With mortgage rates currently hovering around 6%, borrowers are having to qualify for upwards of 8% in some cases.

Forty-one percent of those surveyed believe the federal government should relax the mortgage stress test for first-time buyers, 38% think it should be relaxed for all buyers, and 26% would like it to be eliminated altogether.

OFSI is currently mulling over new mortgage lending restrictions, including loan-to-income and debt-to-income restrictions. If implemented, the measures would further limit what some borrowers qualify for.

To protect yourself from mortgage fraud, the Canada Mortgage and Housing Corporation advises getting title insurance, obtaining a property's sales history before making a purchase, and always using licensed or accredited mortgage and real estate professionals.

Real Estate News