CMHC announced today that effective May 30th they are discontinuing 2 of their products they offer. They will no longer be insuring Second Homes or Self Employed Verified by 3rd Party (Stated Income).
CMHC really has not been doing much stated income for the last couple years so this was no big surprise. If you have a client that is self-employed they will now only be able to qualify with CMHC with the income they claim on their Notice of Assessments.
The second home could be the bigger one here. When you hear second home you often think of vacation home. a Second home is also considered when you have a client that is looking at keeping their current home as a rental and buying another with 5% down. With CMHC you can now only have 1 insured home at a time. This is how they say it – “CMHC will now limit the availability of homeowner mortgage loan insurance to only one property (1 – 4 units) per borrower/co-borrower at any given time.”
So far this is just CMHC but we will see if this goes further.
CMHC press release – http://www.cmhc.ca/en/hoficlincl/moloin/moloin_014.cfm?WT.cg_n=TWT_MLI
Scott Bourke, AMP
Dominion Lending Centres Regional Mortgage Group