Mortgage Stress Is Building in Ontario and B.C., New Data Shows

What the new numbers actually show

Canadian mortgage performance is still strong overall. But the newest credit data shows the strain that does exist is landing hardest in Ontario and British Columbia — and specifically among borrowers carrying the largest balances.

According to TransUnion Canada's second-quarter 2026 Consumer Credit Industry Insights Report, the national share of mortgage balances at least 60 days past due rose six basis points year over year to 0.31%. Ontario posted the largest provincial increase, climbing 10 basis points to 0.41% of balances behind. B.C. was close behind, up seven basis points to 0.28%.

Counted a different way — by number of accounts rather than dollar value — the picture is milder: Ontario's account-level share rose six basis points to 0.32%, and B.C.'s four basis points to 0.27%. The gap between the two ways of counting is the story here. When balance-level figures rise faster than account-level ones, it means the trouble is concentrated among bigger mortgages, not spreading evenly across the borrower base.

Why Ontario and B.C. are showing the most strain

Matt Fabian, senior director of financial services research and consulting at TransUnion Canada, put it directly in the report: mortgage performance nationally remains healthy, but credit stress is concentrating in higher-cost housing markets, where borrowers tend to carry larger mortgage balances and face greater exposure to affordability pressure and payment shocks.

That lines up with the two provinces where the average home carries the largest mortgage. A payment shock — a renewal into a higher monthly cost, a job loss, an unexpected expense — simply does more damage to a household's budget when the underlying balance is bigger to begin with. By comparison, several Prairie and Atlantic provinces stayed stable or improved: Quebec's account-level share was unchanged at 0.22%, with its balance-level share actually easing one basis point.

TransUnion also flagged a specific vintage: borrowers who took out mortgages during the sharp climb in borrowing costs through 2022 and 2023 continue to show more affordability pressure than those who financed more recently, particularly in the smaller subprime segment. Mortgages originated in 2024 have generally performed better — a sign that underwriting since then has been more conservative, or that borrowers who financed then simply qualified with more room.

Who this actually affects

It's worth being precise about what this data does and doesn't say. It is not a signal that the typical Ontario homeowner is in trouble. It's a signal that trouble, where it exists, is showing up more in mortgages with larger outstanding balances — often move-up buyers, recent purchasers in higher-cost markets, or households whose fixed term is renewing into a materially higher monthly cost after financing near the 2022–2023 peak.

• Households who financed or last renewed during the 2022–2023 climb in borrowing costs
• Owners of higher-value properties carrying proportionally larger balances
• Households where one income source has become less predictable since financing
• Anyone who has not reviewed their monthly budget since their last mortgage decision

If none of that describes your situation, the data is background context, not a warning about your own mortgage. If some of it does, the more useful question isn't whether the province-wide number is rising — it's whether your own file has changed enough to warrant a conversation before your next renewal date arrives.

New borrowing is slowing down, too

The same report points to softer growth on the new-lending side. Mortgage originations increased 7.8% year over year in the second quarter — a real slowdown from the double-digit growth recorded in recent quarters. TransUnion attributed the pullback to persistent affordability pressure, economic uncertainty and more cautious buyer sentiment.

One number stands out: the average balance on a newly issued mortgage actually fell 2.4% to $354,683. That's consistent with buyers purchasing less expensive homes, making larger down payments, or shopping in more affordable markets — not necessarily a sign that lending has tightened, but a sign that buyers themselves are being more conservative.

Meanwhile, total outstanding mortgage debt in Canada rose 3.9% to $1.93 trillion even as the total number of mortgage accounts declined slightly, and the average outstanding balance climbed 4.2% to $293,270. Across every form of consumer credit combined, outstanding debt reached a record $2.64 trillion, up 4.6% from a year earlier — a widening gap, in Fabian's words, "across risk tiers."

What this means if your renewal is coming up

The single most useful habit this data supports is not waiting for your lender to reach out. A large mortgage that renews into a materially different monthly cost is exactly the scenario TransUnion describes as concentrating the strain. Reviewing your options months ahead — not the week your renewal letter arrives — is what turns a payment shock into a planned adjustment.

None of this requires a crisis to be worth doing. The households TransUnion describes as under the most pressure are, almost by definition, the ones who put off that review the longest.