For the first time, Statistics Canada has published data from the quarterly Survey of Non-Bank Mortgage Lenders. These lenders held 1.7 million residential mortgages in the fourth quarter of 2018, two-thirds of which were uninsured.
According to Statistics Canada, until recently, residential mortgage data from non-bank lenders were only collected by some organizations at the provincial level, for certain industries and with varying levels of detail. This survey is the first attempt to collect information at the national level and it will help complete the overall picture of the residential mortgage market in Canada.
The survey covers non-bank residential mortgage lenders, such as local credit unions, mortgage finance companies, trusts, insurance companies, mortgage investment corporations and private lenders. The entities included are not only those that originate residential mortgages, but also those that purchase them.
Two-thirds of residential mortgages outstanding are uninsured
Mortgages outstanding refers to the mortgage balances remaining on the lender’s balance sheet as of the end of the quarter. Overall, at the end of the fourth quarter of 2018, 1.7 million residential mortgages with a total value of $325.5 billion were outstanding.
The uninsured mortgages outstanding contributed $188.0 billion (57.8%) to the total value and 1.1 million (65.0%) to the total number of mortgages provided by non-bank lenders.
Uninsured mortgages outstanding had an average value of $170,031 per mortgage, lower than the average value of $230,827 per insured mortgage outstanding.
The majority of residential mortgages extended are uninsured
Mortgages extended are the mortgages approved, issued and added to the balance sheet during the quarter. As a whole, non-bank mortgage lenders in Canada extended 152,554 residential mortgages totalling $39.3 billion in value during the fourth quarter of 2018. Of those, 93,197 were uninsured and they accounted for a total value of $22.8 billion. They represented 61.1% of the total number of mortgages extended and 58.0% of the total value extended.
The average value for uninsured residential mortgages extended was $244,617, again lower than that of insured mortgages extended ($278,537).
Residential mortgages extended during the quarter represented 12.1% of the total value of residential mortgages outstanding and 9.0% of the total number.
More than half of residential mortgages in arrears are uninsured
Mortgage loans are considered in arrears at the end of a quarter if payments are overdue. In the fourth quarter of 2018, 34,638 residential mortgages were in arrears by a day or more, for a total value of $6.4 billion. Of these, 21,641 (62.5%) were uninsured, representing a value of $4.0 billion (62.4%).
Uninsured residential mortgages in arrears had an average value of $185,511, slightly lower than the average value of $185,732 of insured mortgages.
Total residential mortgages in arrears represented 2.0% of the total value and 2.0% of the total number of outstanding mortgages. Of these mortgages in arrears, 4,249 were in arrears by over 90 days, for a total value of $930.4 million. Of these mortgages in arrears over 90 days, 2,524 (59.4%) were uninsured, representing a value of $587.2 million (63.1%).
Uninsured residential mortgages in arrears over 90 days had an average value of $232,646, whereas insured residential mortgages in arrears over 90 days had an average value of $198,949.
Residential mortgages in arrears over 90 days represented 0.29% of the total value of outstanding mortgages as well as 0.25% of the total number of outstanding mortgages.