Individuals who are Canadian citizens, permanent residents of Canada, or
non-permanent residents who are legally authorized to work in Canada.
Loan-to-value (LTV) ratios
For homeowner loans (owner-occupied properties), the
loan-to-value ratio for 1 – 2 units is up to
95% LTV. For 3 – 4 units, the ratio is up to 90% LTV.
For small rental loans (non-owner occupied),
the loan-to-value ratio for 2 – 4 units is
up to 80% LTV.
Minimum equity requirements
For homeowner loans, the
minimum equity requirement for 1 – 2 units is
5% of the first $500,000 of lending value and 10% of the remainder of the
lending value. For 3 – 4 units, the minimum equity requirement
For small rental loans, the minimum equity requirement is
Purchase price / lending value, amortization and location
For both homeowner and small rental loans, the maximum
purchase price / lending value or as-improved property value
must be below $1,000,000.
For homeowner loans, CMHC-insured financing is available for
one property per borrower/co-borrower at any given time.
The maximum amortization period is 25 years.
The property must be located in Canada and must be suitable
and available for full-time, year-round occupancy. The property must also have
year-round access (via a vehicular bridge or ferry if it is on an island).
The down payment can come from sources such as savings, the sale of a
property, or a non-repayable financial gift from a relative.
Whether the property is owner occupied or non-owner occupied, subject to an
MLI application or not, we offer different approaches to
rental income for qualification purposes.
Find out more
about the approach(es) that can be used to calculate rental income and the
inputs to consider when calculating the debt service ratios.
At least one borrower (or guarantor) must have a minimum credit score of
600. CMHC may consider alternative methods of establishing creditworthiness
for borrowers without a credit history.
The maximum threshold is a gross debt service (GDS) ratio of
39% and a total debt service (TDS) ratio of 44%.
The GDS and TDS ratios must be calculated using an interest rate which is the
greater of the contract interest rate plus 2 per cent, or 5.25 per cent.
Single advances include improvement costs less than or equal
to 10% of the as-improved value.
Progress advances include new construction financing or
improvement costs greater than 10% of the as-improved value. With Full
Service, CMHC validates up to 4 consecutive advances at no cost. For
Basic Service, the Lender validates advances without pre-approval from CMHC.
Non-permanent residents (homeowner loans only)
Non-permanent residents must be legally authorized to work in
Canada (with a work permit).
Mortgage loan insurance is only available for non-permanent residents for
homeowner loans for 1-unit property, owner occupied, up to 90% LTV.
Non-permanent residents are not eligible for alternative
methods of establishing creditworthiness. In cases where a credit report is
not available, a letter of reference from the borrower’s financial institution
in their country of origin may be considered.