In particular, uninsured debt dominated among non-bank providers’ products
In its recent analysis of Statistics Canada numbers covering the last quarter of 2018, Better Dwelling noted that non-bank lenders accounted for one-fifth of institutionally held residential mortgages outstanding nationwide.
The StatsCan survey of non-bank mortgage lenders nationwide found that these organizations held over 1.7 million residential mortgages for a total of $325.5 billion as of the end of the fourth quarter.
“These lenders sound unofficial, but they’re a huge segment of the country’s borrowing,” Better Dwelling emphasized in its analysis of the figures. “They provide liquidity. The increased liquidity and competition helps to keep rates low.”
Uninsured mortgages outstanding contributed to $188 billion of the total volume (57.8% of the value), spread over 1.1 million mortgages (65% of the accounts).
During the same quarter, non-bank lenders extended 152,554 mortgages, approximately 9% of the total held in that period. Together, these were valued at $39.3 billion, which was 12.1% of the total volume for that quarter.
This level of activity should be seen in light of the 34,638 mortgages in arrears during Q4 2018, however. Their total value was $6.4 billion, with uninsured mortgages accounting for $4.0 billion (62%) across 21,641 mortgages.
“More serious mortgages in arrears are on par with traditional bank lenders,” Better Dwelling added, noting that 4,249 mortgages were in arrears by over 90 days during that quarter, for a total value of $930.4 million.
Of these critical arrears, 2,524 were uninsured, representing $587.2 million. Accounts in arrears over 90 days accounted for a mere 0.25% of all mortgages held by non-bank lenders.