CMHC to tighten lending standards for homebuyers as of July 1, 2020
Friday Jun 05th, 2020
Effective July 1st CMHC is making the following changes:
1) Reducing the qualifying debt to income ratios from 39% and 44% today to 32% and 42% - This means that effective July 1st homebuyers will effectively qualify for less of a mortgage
2) Establish minimum credit score of 680 for at least one borrower - This means that homebuyers with a credit score in the grey zone of 640-679 will need a minim of 20% down-payment
3) Non-traditional sources of down payment that increase indebtedness will no longer be treated as equity - Homebuyers can not borrow from other sources (ie. lines of credit) to purchase a home with less than 20% down-payment.
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