CMHC has been making changes in accordance to their mandate of contributing to the stability of the housing market to benefit Canadians. They have recently been undertaking a review of its mortgage loan insurance business and as such, has announced a recent change to loan insurance for second home and self-employed individuals.
What does all this mean for you as a licensed real estate professional, and your clients?
“The insurance premiums are going to be increased by approximately 15%. For example, the current 5% down program has a premium of 2.75% added to the mortgage. This will now be increased to 3.15% premium. In addition, CMHC is no longer insuring secondary homes. This means investors or home owners with recreational properties, will have come up with a minimum 20% down payment. There are alternatives for your clients. Contact myself or your mortgage broker to assist with other lending options. For you, as self-employed and commission based people – it is getting more difficult to qualify for a mortgage under CMHC, therefore the alternative lenders (ie: B lenders), are gaining popularity and may prove to be of benefit to you.” ~Jeff Risi, Mortgage Broker
For more information visit CMHC website, or contact your mortgage broker for alternatives and information.