Are you looking to buy, build or renovate a single-family home or multi-unit rental property in your community? Insured loans from CMHC help First Nation members living on-reserve get access to financing for housing projects.

How does the loan program work?

CMHC provides loan insurance to approved lenders. This allows them to confidently offer guaranteed loans for on-reserve First Nation housing projects. An approved lender might be a bank, credit union or Aboriginal Capital Corporation.

An approved lender will work with you to prepare and submit a loan application to us for approval. Your council will also help you get the necessary approvals for your project.

All loans are secured by a council resolution and a ministerial loan guarantee from Indigenous and Northern Affairs Canada (INAC). If you cannot repay the loan, the outstanding balance will be paid to the approved lender by INAC on your behalf. However, INAC will then require repayment from your First Nation.

Who is eligible for a loan?

To be eligible for a loan, you must:

  • have a certificate of possession or have been granted use of the land by the First Nation
  • meet the approved lender’s minimum requirements, including being able to repay the loan

There are also additional requirements based on the type of property you’re buying or building:

  • If you’re a homebuyer, you must have savings (or INAC contributions) equal to at least 5% of the loan’s value. This means if the cost to build your house is $90,000, you need a down payment of at least $4,500.
  • When investing in a property of 4 units or less, the minimum down payment is 20% of the loan’s value. CMHC-insured loans are available for qualified rental projects up to a maximum of 80% of the loan’s value.
  • For rental projects of 5 or more units, the minimum down payment is 15% of the loan’s value. CMHC-insured loans are available for qualified rental projects up to a maximum of 85% of the loan’s value.

For more information about this program, please contact your local CMHC office or CMHC consultant.

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Date Published: March 31, 2018