A closer look at Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation have provided some further insight into their business operations. The following insightful information is based on CMHC’s corporate plan, how they operate, who they insure, some Canadian home value statistics and who’s paying their mortgages.

General market Data:

-CMHC forecasts that it will insure 706,664 mortgages this year, down 15% from it’s expected volumes in 2010 and down 33% from 2009.

-Large multi-unit properties and rural/smaller markets comprise almost 40% of CMHC’s high-ratio insurance business.

Arrears:

-Arrears rates, or consumers that have fallen behind, are in-line with industry trends and as employment figures improve CMHC expects its already low arrears to moderate throughout 2011.

Amortization and Terms:

-The average amortization period for all CMHC insured homeowner loans at initiation is 24 years. The average amortization period for CMHC insured rental mortgages is 25 years.

-The ratio of mortgages with terms over three years is 82%.

Credit Quality:

-Average credit score of CMHC-insured borrowers in 2009: 718 (range is 300-900)

-Only 5% of CMHC insured borrowers have no credit score (need 15% equity to get into this program) or have a score less than 600.

-Almost 70% have scores over 700.

-Twenty-five per cent have scores from 600-699.

Value and Equity:

-Only 10% of CMHC insured properties have a value over $400,000.

-The average CMHC insured homeowner has a balance of $151,630.

-Eighty-seven per cent of CMHC insured mortgages have more than 10% equity in their home.

-Average equity of a CMHC-insured borrower is 46%.

Other:

-Fifty per cent of CMHC-insured high-ratio borrowers accelerate their mortgage payments.

-CMHC plans to guarantee $20 billion National Housing Act Mortgage Backed Securities in 2011 and $32 billion in Canada Mortgage bonds.

All in all, CMHC is Canada’s largest mortgage insurer, while they do have two other competitors, Genworth and Canada Guaranty, they do insure more than 65% of the Canadian home mortgage market. In general, if you have less than 20% down payment or equity, than you will require some form of mortgage insurance as long as you meet the guidelines.

Jean-Guy Turcotte is an Accredited Mortgage Professional with Dominion Lending Centres-Regional Mortgage Group and can be contacted for appointments at 403-343-1125or emailed to jturcotte@regionalmortgage.ca.

Just Posted

Central Alberta Humane Society presents cat yoga

Proceeds will be used to care for the shelter animals

Innisfail RCMP respond to fatal vehicle collision

A 22-year-old driver was ejected and pronounced deceased on scene

Central Alberta Buccaneers pillage Vandals 64-19

Bucs’ notch second win of the season convincingly

Young man from Tees dies in tragic collision

The incident occurred early Saturday morning at Clive

Canada won’t ‘play politics’ on U.S. migrant children policy

The U.S. government is under fire over its ”zero tolerance” policy

Late goal gives England 2-1 win over Tunisia

At the last World Cup in 2014, England couldn’t even win a game

Canadian military police officer pleads not guilty to sex assault

Sgt. Kevin MacIntyre, 48, entered his plea today at a court martial proceeding in Halifax

Three junior hockey players injured starting campfire

Ryan Vandervlis, a 20-year old centre with Lethbridge Hurricanes has been placed in a medically induced coma

Cheers erupt as Federal Court judge approves historic gay purge settlement

Gay military veterans said they were interrogated, harassed and spied on because of their sexuality

Major tire theft at Wetaskiwin auto dealership

Wetaskiwin RCMP estimated $70,000 worth of tires and rims stolen

Capitals coach resigns after Stanley Cup win

Barry Trotz announced his resignation on Monday

Leduc RCMP investigate small plane crash

No injuries after plane crashes in lake

Sweden beats South Korea 1-0

Sweden gets benefit of video review in World Cup

Most Read