Self-Employed Mortgages will now be easier
Self-Employed Mortgages Will Now Be Easier
Canada Mortgage Housing Corporation (CMHC) has improved its mortgage loan insurance approval system to help more self-employed borrowers buy homes and duplexes. Pierre Serre, a CMHC vice-president, says the program, known as Self-Employed Simplified, will make it easier for some self-employed borrowers to obtain mortgage loan insurance and, as a result, access to more competitive interest rates. Serre says the improvements will help self-employed borrowers and commissioned salespeople obtain CMHC-insured mortgages in much the same way as borrowers who receive salaries or hourly wages. The changes, to be implemented March 30, are a response to a growing proportion of self-employed people in the workforce. CMHC says it will use more "sophisticated models" to help assess the risk associated with borrowers who have difficulty obtaining third-party validation of their income.
Major Point: The CMHC program is designed for borrowers who have at least two years in the same type of work and a proven track record of responsibly managing debt (i.e., if you just had your TV repossessed, you don't get it!). It will insure mortgages on one or two-unit homeowner properties and will also be available for refinance transactions for mortgages up to 90% of a home's value.
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