In summary, talk with your realtor about buying a home ASAP.  Make sure you get a ‘live mortgage commitment’ dated before April 19^th 2010.  The new imposed rules will affect how much you are qualified for.

1. 20% minimum down payment for rental properties (used to be 5%)

2. Maximum refinancing reduced from 95% loan to value (LTV) to 90% LTV

3. Use greater of Bank of Canada 5 year ‘posted rate’ to qualify variable mortgages and 1-4 year fixed term mortgages, resulting much less approved loan amount with the same income

4. Use 50% add back on rental income, instead of 80% offset, resulting a huge difference for Vancouver buyers with basement suite as mortgage helper, or investors owning multiple properties

OTHER CMHC CHANGES FOR SELF-EMPLOYED.

5. Effective April 9^th 2010, 100% commissioned individuals (realtors, financial planners, insurance broker, etc) will have to ‘income qualify’ the purchase using *¹ NOA Line 150 net income, instead of ‘stated income’ available for corporate or business owners.

6. Effective April 9^th 2010, CMHC will only consider business owners with < 3 years in business to be eligible to use ‘stated income’ program.  In other words, if you are self-employed for over 3 years in the same field, CMHC will calculate the loan amount based on NOA line 150 reported net income, instead of ‘stated income. *¹ NOA – Notice of Assessment

For more information you can contact Christine Chien at 604-636-1766 or by email at  

cchien@mortgagegrp.com