You may have heard about the news about CMHC new rule for home buyers.
CMHC has tighten the rules to qualify for an insured mortgage. Insured mortgage are high ratio mortgages wherein a home buyer only puts down below 20% down payment of the purchase price. Here are the new rules starting July 1, 2020 to get qualified for a mortgage moving forward.
- At least one applicant’s credit scores will need to be 680
- Non-traditional sources of down payment that increase indebtedness will no longer be treated as equity for insurance purposes- in other words buyer will no longer be able to borrow money for a down payment.
You can still put a down payment of 5% of the purchase price which is great.
Because of these changes home buyers need more help than before to make them successful homeowners. The changes that CMHC made has less impact or change for home buyers out their. However, it is always to get in before these change will happen.
Accure Home’s Rent to Own Program has always been up to date and will provide the necessary tools and resources to make homeownership come true. With the recent changes, Accure Home’s Rent to Own program is aligned to the CMHC rules with our process. Our goal is to get you improve the credit score at least 680 while being in the rent to own program. As always mentioned, our team will provide the education in our program on what you need to do to improve it faster with our tips. Improving credit score requires expertise and understanding it is not just about having no debt and closing all the cards. In fact, you do need a credit card to build credit and to reach 680 requires expertise and education and then you qualified for a mortgage.
The new rule for sources of down payment to not be able to borrow money for a down payment also gives you an advantage in doing a rent to own. Since your down payment is a forced savings in the rent to own program, it will not be considered borrowed money and it will be your own money which again gives you ahead in the game towards qualifying for a mortgage. With the rent to own program, you are building equity and down payment at the end is always not an issue.
The new CMHC rules has less impact to the home buyers. As a matter of fact, it helps you to be protected and Accure Home is committed to help you and guide you through the process and make homeownership in any situation come true. All that people need in becoming a homeowner is education to become like a pro by beating the mortgage rules.