The CMHC wants to make it easier for self-employed Canadians to qualify for a mortgage, and the Financial Post recently wrote a short & sweet article about it. I’ve based this blog post off of the article and included the link at the bottom.
We know that self-employed Canadians typically have a harder time qualifying for a mortgage as their incomes may vary and are less predictable.
The national housing agency says it’s giving lenders more guidance and flexibility to help self-employed borrowers.
CMHC chief commercial officer, Romy Bowers, said self-employed Canadians represent a significant part of the workforce. It makes sense in that case that they not be punished for being self-employed when it comes to qualifying for a mortgage.
“These policy changes respond to that reality by making it easier for self-employed borrowers to obtain CMHC mortgage loan insurance and benefit from competitive interest rates,” Bowers said in a statement.
So what are the policy changes?
The CMHC is providing a broader range of documentation options to increase flexibility for satisfying income and employment requirements. It is also providing examples of factors that can be used to support the lender’s decision to lend to borrowers who have been operating their business for less than 24 months, or in the same line of work for less than 24 months.
The changes which apply to both transactional and portfolio insurance, will take effect October 1st.
We will be happy to see more & more self-employed Torontonians becoming homeowners. And the market should become stronger because of it.
Financial Post article link https://business.financialpost.com/real-estate/mortgages/cmhc-looks-to-make-it-easier-for-self-employed-to-obtain-a-mortgage?video_autoplay=true