CMHC Mortgage Product Changes

CMHC Mortgage Product Changes

CMHC announced on April 25, 2014 that they are discontinuing both the Second Home and Self-Employed mortgage insurance products effective May 30, 2014. These two programs have been available to Canadians for approximately 7 years but account for less than 3% of CMHC’s insured business. Given the limited use of these products, the cancellation of these programs is not expected to have a significant impact on the housing market.cmhc mortgage product changes

The self-employed program allowed business owners to qualify for a mortgage without proving their income. An applicant with great credit could qualify for a mortgage before being able to prove their income by traditional sources. Self-employed Canadians can still qualify for CMHC insured financing with a validation of their income using traditional methods.

The second home program allowed applicants to have two insured mortgages through CMHC, one for a principle residence and one for a second home or vacation home type property. Applicants will no need a minimum 20% down payment for a second home or apply for an insured mortgage through Genworth Canada and Canada Guaranty.

These two programs will continue to be available from both Genworth Canada and Canada Guaranty as both companies have given no indication that they will follow CMHC’s lead at this time.

CMHC Second Home and Self-Employed programs will remain available for new mortgage loan applications submitted to CMHC before May 30, 2014, regardless of the closing date of the home purchase.

2014-05-14T02:17:51+00:00 May 14th, 2014|CMHC, Mortgage News|Comments Off on CMHC Mortgage Product Changes