On Friday, April 25, 2014 CMHC announced that they are discontinuing two of the products in their current portfolio – second homes and self-employed borrowers without traditional proof of income.

The largest mortgage default insurer in Canada has been working to reduce their risk exposure since the Global Economic Crisis in 2008 and on Friday put the market on notice stating that “this is the first set of changes” – so we can expect more?

Well so far, neither Genworth or Canada Guaranty have made similar announcements, with Canada Guaranty stating that while they are reviewing CMHC’s announcement, they have no current plans to make changes to their current product suite. Genworth is in it’s quiet period before earnings so they haven’t been able to comment yet but we can expect something from them soon as earnings were announced on Tuesday.

CMHC says that these two products, together, accounted for 3% of its unit volume so shouldn’t have a “material impact” on the housing market.

So the last day to submit a stated income or second home application,using CMHC’s program, is May 29, 2014.

Fingers crossed that Genworth and/or Canada Guaranty don’t decide to follow CMHC’s lead so that these products will still be available with 5% down for the Second Home program and 10% down for the Stated Income program.

If you think that you might be affected by these changes, contact me to get all of your questions answered!