According to a recent report from Canada Mortgage and Housing Corporation, Toronto is now ground zero for rising mortgage stress in Canada — even as official delinquency rates still look “low” on paper.
But behind the statistics, pressure is building fast.
The Numbers That Are Raising Alarms
In the third quarter of 2025, the Greater Toronto Area recorded:
2,797 homeowners in mortgage arrears
Up from just 662 in the same period of 2022
That’s a 4× increase in missed mortgage payments
While the overall delinquency rate sits at 0.26%, CMHC warns the pace of growth is what matters — and Toronto is leading the country.
“Mortgage arrears have been rising steadily for nearly three years, and Toronto is driving that increase,” said CMHC’s deputy chief economist.
Why Toronto Is Being Hit Harder Than Anywhere Else
Toronto homeowners are facing a perfect storm:
1. Mortgage Renewals at Much Higher Rates
Nearly 2.2 million mortgages — 45% of all mortgages in Canada — renewed in 2024 or 2025, many jumping from pandemic-era rates to dramatically higher payments.
For some households, monthly mortgage costs increased hundreds or even thousands of dollars overnight.
2. Job Market and Income Uncertainty
Historically, CMHC says the number one driver of mortgage arrears is unemployment.
Even small income disruptions — job loss, reduced hours, contract gaps — can quickly translate into missed payments when mortgage costs are already stretched.
3. Falling Prices + Slower Sales
Toronto home prices dipped below $1 million for the first time since 2021, while sales activity remains slow.
That means:
Less ability to refinance
Harder to sell quickly
Reduced access to home equity when it’s needed most
4. Higher Living Costs Across the Board
Rising household debt, food costs, utilities, and property taxes are squeezing budgets — especially for homeowners who bought near the market peak.
The Homeowners Most at Risk Right Now
CMHC’s data shows mortgage stress is not evenly distributed.
The highest-risk groups include:
First-time homebuyers
Pandemic-era buyers (2020–2022)
Homeowners with high debt-to-income ratios
Buyers who purchased with limited equity
These borrowers were heavily concentrated in the GTA — which helps explain why Toronto is seeing faster deterioration than cities like Montreal, Ottawa, or Halifax.
Why This Matters — Even If You’re Still “Up to Date”
Many homeowners assume mortgage trouble only starts after multiple missed payments.
In reality, stress builds long before arrears appear:
Credit cards get maxed
Lines of credit carry balances longer
Emergency savings disappear
Renewals and refinancing options quietly shrink
By the time arrears show up in official data, options are already limited.
How Equity-Based Lending Is Quietly Preventing Defaults
This is where many Toronto homeowners are finding relief — before missing payments entirely.
Private, equity-based mortgage solutions are being used to:
Bridge high-rate renewals
Consolidate debt to reduce monthly outflows
Prevent forced sales or power-of-sale scenarios
Buy time until rates stabilize or income improves
At Lendworth, we’re seeing more homeowners act early — accessing equity while they still have leverage, rather than waiting for bank declines.
The Bottom Line
Mortgage arrears in Toronto are still historically low — but the trajectory is moving in the wrong direction, and faster than expected.
If:
Your renewal payment jumped
Your income feels less predictable
Refinancing with the bank suddenly feels harder
Or you’re relying on credit just to stay current
It’s time to look at options that prioritize equity, speed, and flexibility — before stress turns into default.
📞 Talk to Lendworth today
Private mortgage solutions built for real-world conditions — not outdated bank rules.