June 4th 2020
CMHC announced new guidelines effective July 1, 2020 for their underwriting of all insured mortgages. This impacts all borrowers that have less than 20% down payment.
The most important factors are debt ratios, this means borrowing power is reduced so clients will qualify for less and possibly have to pay down significant amounts of debt.
Another important factor is the increase to the minimum credit score. At least one borrower must now have a credit score of 680 to qualify. This is an increase from the current cutoff of 600.
For down payment, clients can no longer use borrowed funds and the entire down payment has to come from savings or a gift from family.
Send your clients for a pre-approval so we can ensure they qualify under these new guidelines.
Please see the full press release at the link below for all the details.
Contact Us Today!