Edmonton, St Albert, & Area RE/MAX Real Estate Professional

Canada Mortgage and Housing Corporation Insured Mortgages (CMHC)

February 16th 2010:

Jim Flaherty, Canada's Minister of Finance, announced new lending guidelines for CMHC backed mortgage loans in an announcement earlier Tuesday.

The new rules are as follows:

1.  All borrowers must qualify for a mortgage using the five year fixed rate regardless of the term chosen.

(Example: if you wish to take out a 1 year mortgage at 2.65% you will still need to qualify at the 5 year closed rate of 3.89%)

2.  When refinancing a home, Canadians will only be able to refinance up to 90% of the value instead of the previous 95%.

3.  If you want to purchase a revenue property, CMHC will no longer insure you. You'll need to put 20% down and take out a conventional mortgage.

These changes come into effect April 19th 2010.

What has NOT changed:

*  You can still purchase a property with 5% down!
*  You can still do a 35 year amortization!
*  You can still have GDS/TDS ratios up to 44% if you have a credit score over 680!

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I would like to thank Natalie Wellings of Mortgage Success (http://YourEdmontonMortgage.com) for itemizing this info.

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Ben Officer, CD   REALTOR®

RE/MAX Real Estate (Edmonton)