The End For CMHC 40 Years Mortgage

July 18, 2008

Effective October 15, 2008 CMHC 40 years mortgage will not be available to home buyers in Canada. CMHC and Genworth Financial will continue to offer their 35 years mortgage.

In addition, home buyers are required have 5% down payment for CMHC financing. The requirement for 5% down payment could make it harder for first-time buyers to qualify for government-insured mortgages.

Requiring buyers to put down 5 per cent of the purchase price in cash will have a bigger impact than the vanishing 40-year mortgage, says Jim Murphy, president of the Canadian Association of Accredited Mortgage Professionals.

Borrowers will also need a minimum credit score of 620 to qualify for a government-insured mortgage. The minimum credit score used for government-insured mortgages can be less than than 620 presently if a borrower’s employment history, income, co-signer or other factors make sense.

The elimination of the 40 years mortgage means an extra $50 to $60 monthly payment for a 35 years plan. This is not expected to deter a home buyer from buying a home.If you like to speak to have more information on getting a 40 years mortgage, you can contact me (Elsie Tse) at 604-716-3369 or Email Me 

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