Headwinds for new homeowners in parts of Canada The Globe and Mail reports in its Saturday, March 23, edition that the Office of the Superintendent of Financial Institutions has taken measures to limit highly-leveraged loans in banks' residential mortgage portfolios. The Globe's triple bylined item reports that the number of these loans has increased alongside rising house prices, making Canadian borrowers among the most highly indebted in the world. Three unnamed sources says the OSFI has instructed lenders to restrict the number of mortgages that exceed 4.5 times the borrower's annual income. The new income limit comes on top of existing mortgage qualification rules, including the federal stress test that requires borrowers to be able to pay their mortgages if interest rates are two percentage points higher than the negotiated rate. Banks will be allowed to exceed this new income ratio for some clients, creating scope for relief for borrowers in expensive cities such as Toronto and Vancouver. The new rule will only apply to new mortgages and not to existing loans or to loans that come up for renewal. It is expected to take effect in the first quarter of next year.