CMHC’s changes to the self-employment program

CMHC’s changes to the self-employment program

People who work for themselves often run into problems in the mortgage market because income is variable and unpredictable. As of October of last year, buying a home became easier for the self-employed to secure a mortgage. According to CMHC, the self-employed make up about 15 percent of Canada’s population. The unpredictable income these have made things difficult to get a mortgage as they did not meet some of the requirements.

Why were these changes created?

The main reason CMHC came up with these changes was to give lenders more guidance and flexibility when it comes to the self-employed borrowers. This way, lenders can go through a list of factors to support their decision to give a mortgage to the self-employed borrowers who have been operating their business for less than two years or who have been in the same line of work for less than two years.

What factors count for the self-employed mortgage list?

  • Acquisition of an established business.
  • Sufficient cash reserves.
  • Predictable earnings.
  • Previous training and education.


Besides the above factors, CMHC also presented a broader range of document options that could be used to meet the income and employment requirements to qualify self-employed borrowers for a loan. The list of documents includes:

  • Notice of assessment acoompanied by a T1 General Tax form
  • Proof of income statement from the Canada Revenue Agency
  • A form T2125 – a statement of business or professional activities

If the borrower has a down payment of less than 20 percent of the value of the property, a mortgage insurance is required. Check out our blog post on CMHC mortgage insurance.