A few weeks ago CMHC launched a new mortgage insurance program for rental properties. It’s designed for investors and applies to properties with up to 4 units. The program has generated a lot of interest in a short amount of time.
Up to 100% financing is available (for 1-2 units only)
Approval decisions are fast
40-year amortization or interest-only terms are available to improve cash flow
Title can be in the name of a business
A 650 credit score (680 for 100% financing) and verifiable income are required.
There are two downsides however. First, almost no lenders are participating in CMHC’s $0-down rental program. Second, CMHC’s default insurance premium (assuming you put nothing down) is 7.25%. Fortunately, these premiums can be tax deductible on income properties, which reduces the impact (consult your accountant).
Call us or your favorite mortgage planner for more details.
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