Canadian mortgage delinquencies are climbing at the fastest pace in a generation, and that’s only the visible part of the problem. Equifax data shows the rate continued its sharp ascent in Q2 2025, up from record lows barely two years ago. The trend offers only a glimpse of the broader credit stress now rapidly emerging across the mortgage market.
Canadian Mortgage Delinquency Rate Is Climbing Fast
Mortgage arrears are rising quickly across Canada’s mountain of debt. The delinquency rate climbed 1 basis point (+4.5%) to 0.23% in Q2 2025, and 2 basis points (+9.5%) from last year. Nearly half the annual increase occurred in the last quarter alone, showing the acceleration is recent—not a lingering issue quietly resolving itself.
The rate remains historically low, but the velocity of change tells the real story. Problems rarely appear overnight—they’re built through a steady erosion. A flat rate suggests lenders have contained the damage; a rising one means they’re still learning the extent of the problem. Known and understood risks have never broken a credit market—they fail when lenders and borrowers struggle to adapt.
Canadian Mortgage Delinquency Rate Makes Sharpest Climb In Recent History
Canadian mortgage delinquency rate on Equifax.
Source: Equifax; CMHC; Better Dwelling.
Canadian mortgage delinquency rates have seen a sharp increase over the past few years. Just over two years ago, in Q4 2022, the delinquency rate was 0.14%—a record low. Since then, it’s climbed 9 basis points (+64%), marking the sharpest climb in modern records. Early signs of stress are becoming apparent after years of easy credit.
Canadian Mortgage Problems Are Bigger Than You Think™
The reported delinquency rate is only a glimpse of a much larger problem. Equifax is a very large data set, but it’s far from comprehensive. The Big Six banks hold most of Canada’s mortgages, and all but one recently reported delinquency rates higher than Equifax’s average—a reporting gap likely to surface later.
Uncaptured stress is also rising. Private lending arrears aren’t typically included in Equifax’s figures, yet investors—who drove much of the recent delinquency growth—rely heavily on private credit for new construction. That’s a blind spot large enough to skew the national picture.
Power of Sale listings also hint at more hidden stress. Toronto has seen a recent surge in these lender-controlled listings, though none of the Big Six banks appear directly tied to them despite heavy exposure. Once again, the rate reveals little; it’s the trend that exposes the underlying strain in Canada’s credit system.
We have owned a few over the years. Got rid of them quick.
Renting an apartment is far more cost effective = no strata, no interest, no mortgage, no special assessments, repairs, replacements, no risk from morons wrecking common property, causing floods etc.
https://www.theglobeandmail.com/real-estate/toronto/article-waterfront-condo-sellers-face-herd-mentality/
Whatever the problem is in the big six, it it likely very many more times worse than that in the private market, which is where the riskiest, most speculative, least credit worthy borrowers are… You only go into the private market if the big 6 won’t play ball with you, and there will be a reason for that !
We have two investor owned houses that have gone Power of Sale both by private lenders in our fairly small neighborhood. Each one with a large number of registered delivery notices affixed to their front door.. The neighbors say they’ve hightailed it back to a certain country after withdrawing what was left of their equity via their HELOCS
I was in Toronto a while backand all anyone e kept saying is rates have to com e down? Now we know prices there are low by 20% already, meaning there are lots of people with zero or negative equity now. So it’s only a matter of time before they realize what thT means ….
Also, the bone head carney has been not only a spectacular failure in trade talks,he must know that a showdown between lenders and Canadians is coming, yet in typical liberal fashion is still lying to us about housing. We don’t need more liberal money wasting schemes, wanted a solution that doesn’t see 1 I. 3 of us bankrupt and homeless?
Okay, there is no surprise here, wondering how many of these people had the 1.6 interest rate and now it’s what…. 5 % or higher ? Bank of Canada and fixing inflation …. that no one understands…. raising borrowing rates through the roof making home ownership a nightmare….making builders life a nightmare … and add in the re-elected Liberals….. who crashed everything by spending money in all the wrong places from the previous terms in office. OMG good thing the conservatives got rid of the carbon tax…. Or was that the Liberals…. Who stole the idea… should be a refund. Probably save some home owners. Gosh what’s a person to think.
Well a person is to think that you are either a developer or realtor or over-indebted homeower, as that is your clear bias. Interest rates never should have been LOWERED to negative real rates, EVER (a worldwide central bank disaster). There was no excuse for that. And lowering them to near zero again during COVID was beyond stupid – short term gain for long term pain.
So you and every other special interest group trying to make a fortune off real estate got lucky when you took advantage of this, but you really can’t whine when interest rates return to a normal range as now – you took that gamble and took on too much debt – not our problem, not the taxpayers ‘ problem. Want privatized profits? Then accept the privatized losses too!
And every action taken by BOTH parties in power over the last 20 years to support housing to ensure it ‘always goes up’ was a key problem. Housing never should have been gambling , a lottery win – it is shelter. The resulting asset inflation has caused pain to everyone – and now everyone wonders why young people aren’t having babies? Here’s a hint – they can’t afford suitable shelter to do so. And no f’ing way would I or anyone else choose to raise 2 kids in a 700 sqft condo!
And carbon tax is a strawman – if you can’t afford the tax on fuel, then don’t buy yourself an $80k gas guzzling truck!
Tell me you know literally nothing about monetary policy and how money works but don’t tell me. But you know, blame the liberals somehow. God far right people are all the same. Allergic to education.
I really enjoyed the article on Power of Sales, but this one is hitting the clickbait headline hard! C’mon, delinquencies moving from 0.22% up to 0.23% is hardly “soaring”.
Keep up the good work, though!
+64% of almost nothing is still nothing.
One can’t help but wonder why you keep pushing this narrative.
I mean apparently we had mortgage disaster in 2019, can’t recall that one.
And 2022 was the historical lowest delinquency of all times.
So please let’s not spread panic.
Tell me you didn’t understand what you just read without telling me.
The problem is that when the banks are clearly lending far beyond the accepted ratio for debt, using all kinds of schemes to cover up what is a massive credit risk, eventually the pondicherry scheme will collapse.
This mess in canada is exactly what killed the us economy in 2009. Lending far far too much to people who rely upon constant refinancing to pay it back.
As soon as housing goes from a monthly payment for a place to live, into an i vestment, and then into a career, we have a massive problem.
This is exactly how all credit crisis start, deliquencies are a very lagging g indicator.by the time equifax is reporting it, it’s 3-6. Months later. If housing continues to face steep price declines, adding the inept liberal economic mess killing jobs, and our economy contracting weare in for a seriously bad time.even worse, the people in centralcanada keep the same goofs who didn’t in charge? No wonder so many people are just leaving this sinking ship….
A correction is necessary unless you want your children and grandchildren and three pets all living in your house ……but maybe that’s the new future. :).