Devin Cristo and Wes Will are Licensed Mortgage Associates with Your Mortgage Link, Brokerage License #315794. Your Mortgage Link is a Saskatchewan-based brokerage operation, with offices in Saskatoon and Regina, competing in the wholesale mortgage market Canada wide. Our goal is to offer clients a broad range of mortgage products, and create competition between many of Canada’s top lenders.
Mortgage Payment Difficulties
When unforeseen financial circumstances impact your ability to make regular mortgage payments, or disaster strikes, it’s important for you to take quick action. With early intervention, cooperation, and a well executed plan, you can work together with your mortgage professional to find a solution to your financial difficulties.
What Can We Do to Help?
If you find yourself facing financial difficulties, as a result of job loss, family income reduction, or for other reasons, it can be an overwhelming experience leaving you feeling uncomfortable and unsure of what to do. By following these three simple steps, you can make a big difference in resolving your financial difficulties.
1. Talk to your mortgage professional
- To increase the chance of successfully managing your financial situation through early intervention, call your mortgage professional at the first sign of financial difficulty;
- Ask the mortgage professional about information on the options available for managing your financial situation; and
- Keep the mortgage professional informed as circumstances evolve.
2. Clarify the financial picture
In order to help your mortgage professional fully understand your financial situation, before meeting with them, prepare a detailed list of financial obligations including any credit cards, loans, household bills with the amounts owing and their due dates. Be sure to include information about your current income, savings accounts, investments, and any other assets.
3. Stay informed
The more information you have at your disposal on managing your finances, the easier it will be to make the right decisions.
Take Charge of Your Debts is an online tool from the Government of Canada that is designed to help borrowers like you understand debt problems, and includes information on making a budget, budget counselling, collection agencies, credit, and credit repair. To view this tool, log on to www.ic.gc.ca (Industry Canada) and search for “Take Charge of Your Debts”.
How Can Your Mortgage Now and CMHC Help?
Your mortgage professional wants to establish and maintain a positive relationship with you over the long term, and is fully trained and equipped with the tools to help you deal with the temporary financial setbacks that you may be facing.
For mortgages insured by Canada Mortgage and Housing Corporation (CMHC), CMHC provides mortgage professionals with tools and the flexibility to make timely decisions when working with you to find a solution to your unique financial situation. These tools include:
- Converting a variable interest rate mortgage to a fixed interest rate mortgage in order to protect you from a sudden interest rate increase, should one occur.
- Offering a temporary short-term payment deferral. Your mortgage professional may be prepared to offer greater payment flexibilities, particularly if previous lump sum prepayments have been made, or if you have previously chosen an accelerated payment schedule.
- Extending the original repayment period (amortization) in order to lower your monthly mortgage payments.
- Adding any missed payments (arrears) to the mortgage balance and spreading them over the remaining mortgage repayment period.
- Offering a special payment arrangement unique to your particular financial situation.
CMHC is also willing to consider other alternatives proposed by the mortgage professional to resolve or avoid mortgage payment default. In every case, the options available will depend upon your individual financial circumstances.
CMHC Tools to Support Canadians Affected by Fires in Fort McMurray and Area
CMHC joins Canadians in expressing our concern for the people of Fort McMurray and the surrounding area that are dealing with devastating forest fires.
As residents continue to deal with the effects, CMHC wishes to remind mortgage professionals that we can help you assist homeowners that may be affected by these unfortunate events. and their impending Mortgage Payment Difficulties.
For borrowers with CMHC-insured mortgage loans that are affected by the fires and who may require special arrangements to meet their mortgage payment obligations, CMHC offers Approved Lenders a series of default management tools including:
o Deferral of payment
o Re-amortization of the loan, to result in lower payments
o Capitalization of outstanding interest arrears and other eligible expenses
o Special payment arrangements
o A combination of the above
Approved Lenders have the flexibility to make these special arrangements quickly and without CMHC approval provided that they retain a documented analysis of the borrower’s financial situation on file. Approved Lenders can refer to the CMHC Homeowner Default Management Guide for complete details on CMHC’s default management program. Please find attached a flyer providing a summary of these arrangements.
Approved Lenders are reminded that properties must be adequately protected by standard insured perils and that any damage exceeding $5,000 should be reported to the CMHC Claim Payment Centre.
CMHC recognizes that homeowners affected by the fires may experience some financial hardship due to income shortages resulting from temporary evacuations or due to the need to rebuild or repair their homes. CMHC encourages homeowners with CMHC-insured mortgages to contact their financial institution at the first signs of financial difficulty to discuss their specific situation.
To help you share information with any of your clients that may be affected, please also find attached CMHC’s “Dealing with Mortgage Payment Difficulties” factsheet.
CMHC’s Default Management Tool Selector can also help lenders to determine what CMHC default management tools are most appropriate given the borrower’s circumstances. CMHC also offers comprehensive training to Approved Lenders covering CMHC’s default management tools and more. If you are interested in obtaining training, please contact your CMHC Account Manager, Client Relations.
CMHC’s Default Management and Claim Specialists are also available to assist you at any time, including before a default occurs and during early stages of payment delinquency. The Specialists have the expertise to help you manage unusual or complex default situations. Contact the Claim Payment Centre, Monday to Friday at 1-866-358-9999 or by email at firstname.lastname@example.org, to speak with a Specialist.
You can work with confidence, knowing that you are supported by an experienced and informed mortgage loan insurance provider in the Canadian housing market.
Do not hesitate to contact me if you have any questions or require assistance.
CMHC is Canada’s national housing agency. For over 65 years CMHC has shared a wealth of knowledge and housing expertise to help create an informed and reassured homeownership experience for Canadians.