Summary of CMHC Underwriting Criteria Changes

1. Enforcing Gross/Total Debt Servicing (GDS/TDS) ratios of 35%/42%.

CMHC previously approved loans with ratios up to 39%/44% for borrowers with high credit scores and more reliable income.

CMHC-insured loans with a GDS above 35% represent an average of 18% of transactional new insurance written.

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2. Establishing a minimum credit score of 680 for at least one borrower.

The previous CMHC standard was a minimum 600 credit score.

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3. Non-traditional sources of down payment that increase indebtedness will no longer be treated as equity for insurance purposes.

In 2019, non-traditional sources of down payment applications were less than 2% of all CMHC’s homeowner transactional approved loans with a loan to value above 90%.

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At this time, it is not determined whether Canada Guaranty and Genworth will follow suit with these guideline changes….