Effective April 9, 2010, CMHC is revising the Insured Business for self policy as follows :  

Maximum loan-to-value ( LTV) :

*     Purchase Transactions 90% ( from 95% LTV).

 *    Refinance Transactions 85% ( from 90% LTV).  

 Eligibility Criteria Changes :

*    Self Employed borrowers must be able to substantiate that they have experience  working in the same field for a minimum of 2 years.  This can include time spent  working as a non self-employed  worker in the same field.

 *    Evidence of self employment documentation provided must confirm borrowers have been self-employed in the same business for less than 3 years and may be confirmed by providing any one of the following: Sole Proprietorship or Partnership

*    Business license Corporation

 *    Articles of Incorporation  

 *    Maximum of 3 years self employed - Applicants that have been self employed for greater than 3 years are not eligible under this policy and must be approved following the standard total debt services (TDS) ratio and income confirmation guidelines.

  *    Applicants who earn commission are no longer eligible under this policy and will now be approved following the standard TDS and income confirmation guidelines.

 The new policies outlined above apply to all Mortgage for Self-Employed (MFSE) applications submitted to CMHC on or after April 9th, 2010.