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JUST FIVE
PERCENT DOWN
PAYMENT?
 CANADA
MORTGAGE &
HOUSING
CORPORATION
MORTGAGES
AND THE
FIRST TIME
HOME BUYER
CMHC is the
housing
agency of
the
Government
of Canada.
It is a
Crown
Corporation
with a
mandate to
encourage
the
construction
of new
housing, the
repair and
modernization
of existing
houses and
the
improvement
of housing
and living
conditions
for
Canadians.
CMHC advises
the Federal
Cabinet on
housing
matters,
designs
programs to
help
Canadians in
need get
adequate
housing and
administers
federal
housing
programs.
CMHC also
helps
maintain a
healthy and
stable
mortgage
financing
environment
so that the
housing
market can
effectively
meet rental
and
ownership
market
demands. By
creating and
selling
mortgage
loan
insurance
products,
CMHC
increases
the access
of
individual
Canadians to
home
ownership,
helps
finance
rental
housing
construction
and helps
the private
sector to
finance 100
per cent of
social
housing
projects at
competitive
interest
rates.
MORTGAGE
LOAN
INSURANCE
Under
Canadian
law, certain
lending
institutions
cannot
provide
first
mortgage
financing in
excess of
75% of the
purchase
price or
lending
value of a
house unless
the mortgage
is insured.
Buying a
home is one
of the
largest
financial
decisions
most people
ever make.
That is why
it is so
important to
get the
right
financing.
With a CMHC
insured
mortgage
loan, your
down payment
can be as
low as 10
per cent of
the purchase
price ...or
just 5 per
cent if
you're a
first time
buyer. That
means you do
not have to
put as much
aside for
the down
payment, so
you can buy
sooner.
How much do
I have to
earn to
qualify for
a CMHC
mortgage
loan?
When you
borrow more
than 75 per
cent of the
purchase
price of a
home, you
can finance
in one of
two ways:
1. You can
take out an
insured
mortgage
loan for up
to 90
percent of
the purchase
price... or
up to 95 per
cent for
qualified
first-time
buyers.
In some
cases, you
may be able
to assume an
existing
mortgage at
better than
current
rates
(although
you may have
to look at
secondary
financing to
complete
your
purchase).
TO BUY A
HOUSE WITH A
CMHC
MORTGAGE FOR
FIRST TIME
HOME BUYER
The minimum
down payment
is 5% up to
maximum
property
values
depending on
the location
of the
property.
Any one
applicant
must not
have owned
or bought a
property in
the last
five years.
It is
important to
note that
there are
many other
conditions
not
mentioned
above when
applying for
a CMHC
mortgage.
Your Real
Estate
Mortgage
Broker can
assist you
by answering
your
questions
and helping
you apply
for a
mortgage as
a first time
homebuyer.
CMHC FEES
AND PREMIUMS
You pay an
application
fee to cover
the costs
incurred by
CMHC to
review your
application.
Once your
application
is approved,
you pay an
insurance
premium
based on the
size of the
loan. This
premium can
be paid as a
lump sum, or
you can
usually add
it to your
mortgage
loan.
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