Six months ago, before the credit crunch bit and risk became a cutting four-letter word, obtaining or renegotiating a mortgage was pretty much a formality.

It's harder now. Financial institutions haven't necessarily changed their lending criteria for mort-gages, but they do apply them more strictly. "Greyarea" borrowers who would have received the benefit of the doubt a year or two ago might need to apply several places now before finding a taker.

The doors are still wide open, though, for clients with steady income, significant assets and/or a solid credit history. They are, in fact, the object of keen competition between lenders, and as such are in an excellent bargaining position in what is normally the biggest month of the year for mortgage transactions.

With interest rates near historic lows, housing prices plateauing, and both provincial and federal governments offering tax incentives for renovation and higher RRSP withdrawals for home purchases (now a maxi-mum of $25,000 per person), a compelling case can be made for buying, or converting existing home equity into cash now.

That's provided you feel secure enough about your own situation, the overall economy and resiliency of the real-estate market to take the plunge.

Apparently, many people still do. In RBC's annual home-ownership survey, conducted in January and made public this week, 22 per cent of Quebec respondents said they intend to purchase a home over the next two years, up from 21 per cent in 2008 and 19 per cent in 2007.

But York University professor Moshe Milevsky, who has written extensively about mort-gages, cautions that "there are a number of factors that one should take into account when choosing a mortgage, or buying a house that were non-issues a few years ago--security of career and job, an ample down payment, liquidity concerns. They should all be part of your financing decision."

This week's half-point reduction of the Bank of Canada's key overnight rate to a record low of 0.5 per cent led to a drop in the banks' prime lending rate to 2.5 per cent, which in turn resulted in lower borrowing costs for variable-rate mortgages (though fixed-term mortgages did not move).

Variable-rate mortgages, which are linked to the prime rate, now carry interest rates as low as 3.3 per cent. That compares favourably to 4.15 per cent for the lowest rate on a five-year fixed mortgage available through Quebec mortgage broker Multi-Prets, though it's not nearly as attractive as the deal secured by variable-rate borrowers before the credit crunch. The prevailing rate then was as much as one per cent be-low prime, meaning some homeowners today are paying as little as 1.5 per cent. For new lenders, it's prime plus 0.8 per cent, or more.