Below are some of the questions about CMHC that are most frequently asked by our customers. If you cannot find an answer to your questions here please use the form at the bottom to email us your questions and we will answer them as soon as possible.
For additional information visit the CMHC Website at http://www.cmhc-schl.gc.ca/

Q. What is CMHC?

A. Canada Mortgage and Housing Corporation (CMHC) is the Government of Canada's national housing agency with a mandate to help Canadians gain access to a wide choice of quality affordable homes.

For over 50 years, CMHC has been contributing to improving the living conditions and the well-being of Canadians through four areas of housing activities -- housing finance, assisted housing, research and information transfer and export promotion.

CMHC's housing finance activities are centered around giving Canadians access to affordable financing choices. The main tool for achieving this goal is the CMHC Mortgage Loan Insurance program which has helped many Canadians realize their dream of owning their own home.

Q. What is Mortgage Loan Insurance and why do you have to pay a Mortgage Insurance Premium?

A. When you need a mortgage loan that is more than 80% of the purchase price of your home you must buy Mortgage Loan Insurance. Having CMHC Mortgage Loan Insurance means that if you, the borrower, default on your mortgage, the lender is paid back by CMHC. With the risk of losing their money removed, lenders have the confidence to make mortgage loans of up to 95% of the purchase price of the home.

That means your down payment can be as little as 5% of the house price. With Mortgage Loan Insurance many Canadians who might be unable to obtain a 20% down payment can still buy a home.

Loan to Value Ratio Single Advance Rate* Multiple Advances** Up to and including 65% 0.50 1.00 Up to and including 75% 0.65 1.15 Up to and including 80% 1.00 1.75 Up to and including 85% 1.75 2.50 Up to and including 90% 2.00 3.00 Up to and including 95%:     Traditional Down Payment 2.75 4.25 Flex Down Payment 2.90 4.25       * Premium/Single Advance - payable at time of loan advance. ** Premium/Multiple Advances - payable as funds advanced.

Q. Is there a Maximum Purchase Price if you purchase a home with a 5% down payment?

A. "Price Ceilings" are no longer in effect regarding real estate purchases where the purchaser has less than a 10% down payment.

However, for refinancing an existing CMHC mortgaged property the maximum amount of mortgage increase is $ 200,000.00.

Enter your purchase price in the 5% DOWN PAYMENT example Calculator and calculate 'your' 5% down payment, 95% mortgage amount, CMHC Insurance Premium, the total mortgage amount and the PST payable on the CMHC mortgage insurance premium.

Q. Do CMHC premiums apply every time you move and purchase a home with less than 25% down payment?

A. Not necessarily. Most mortgage lenders offer their clients a portability option. This means you can transfer the terms and conditions of your mortgage to your next home.

CMHC introduced a portability feature for mortgages advanced after April 1st 1996. When you port a mortgage from one property to another it is also possible to port the CMHC insurance. There is no premium charged on the insurance that is ported, however if additional mortgage funds are required an additional premium will be charged, but the premium charged would be on the additional funds only. Special conditions apply to the portability product. Exercising the portability feature of an existing mortgage can, in many instances, be advantageous to the purchaser. Now with CMHC's portability feature significant additional savings may apply*.

*For mortgages that were in existence prior to April 1st, 1996, the CMHC portability feature is not available.

For a better understanding of the portability of a CMHC Mortgage Insurance Premium please review JEM's CMHC-PORT-TOP-UP example.

Q. Can you buy a mobile home with a 5% down payment?

A. Yes! Through CMHC's Chattel Loan Insurance Program (CLIP), CMHC will insure a loan on either a mobile or modular home on leased land. While CMHC is insuring a chattel loan rather than a mortgage, the chattel loan insurance bears many of the same features as the CMHC mortgage insurance. The loans are available with as little as 5% down and are generally offered at first mortgage rates. This program was created to give lower income Canadians the opportunity of home ownership.

The mobile or modular home must be a principal residence with year round access. Both the borrower and the property must qualify by meeting CMHC's criteria.

If you are considering the purchase of a mobile or modular home on leased land with a 5% down payment review our 5% DOWN PAYMENT example.

Q. Can you buy a duplex with 5% down?

A. YES, it is possible to purchase a duplex with as little as 5% down. CMHC will insure a mortgage on an owner occupied legal duplex up to 95% of the value and 80% of the rental income can be applied for residential duplex purchases.

If you want to purchase a 3 or 4 unit property and occupy one of the units CMHC will insure a mortgage of up to 90% of the value and 50% of the rental income can be applied for residential 3 or 4 unit purchases.

If you are considering the purchase of a duplex, tri-plex or four-unit building please review JEM's SMALL MULTIPLE PROPERTIES example.