As announced on Monday, March 16, 2020, the Government of Canada has implemented measures to bolster the financial system and the Canadian economy through the launch of a revised Insured Mortgage Purchase Program (IMPP).
Under this program, the government will purchase up to $50 billion of insured mortgage pools through CMHC. This action will provide stable funding to banks and mortgage lenders in order to ensure continued lending to Canadian consumers and businesses.
CMHC is pleased to offer the details for the Purchase Operations which also includes the details of our first Purchase Operation on March 24th up to a total of $5 billion. In addition to the access to liquidity provided through the IMPP, CMHC is also ready to expand the issuance of Canada Mortgage Bonds, which is part of our standard mortgage-funding suite of products. This additional issuance would depend on market conditions and investor demand.
To complement the IMPP, the Minister of Finance also announced today that the eligibility rules for portfolio insurance are being temporarily relaxed to assist mortgage lenders access to the IMPP. Effective March 24th, low loan-to-value loans with amortization up to 30 years, as well as refinance loans funded prior to today, will be eligible for portfolio insurance. Additional details on the eligibility rules will be provided to Approved Lenders shortly.
These supports to the financial sector build on previous measures announced by the Government of Canada to provide significant and effective action to support Canadian individuals and businesses facing financial hardship as a result of the economic impacts of the global COVID-19 outbreak.
“Canada has CMHC for events such as these. This pandemic shines a bright light on the value to our country of a safe, affordable home for everyone – on the importance of a sanctuary. We are working with our federal government colleagues to use our full authorities to ease the impacts on Canadians during these uncertain times.”