Some borrowers may face unforeseen financial circumstances that may impact their ability to maintain ownership of their home. With early intervention, cooperation and a well-executed default management plan, lenders and borrowers can work together to find winning solutions to many financial problems.
CMHC’s Default Management Tool Selector can help lenders to determine what CMHC default management tools are most appropriate given the borrower’s circumstances. For the purposes of the tool, it is assumed that the borrower is experiencing financial difficulty and/or that the loan is in default.
The borrower anticipates missing an upcoming mortgage payment and/or recently missed a payment and is in danger of missing a further mortgage payment.
The borrower is still employed with stable household income but may be experiencing temporary cash flow problems or unexpected home repair costs.
Borrower situations may include temporary leaves such as parental leave or leave of absence due to health-related issues, and/or an outlay of a large unexpected repair expense.
The borrower typically has some equity in the property and an ability to afford increased payments to recapture any missed payments.
The borrower has missed or is about to miss at least two, and up to four, monthly mortgage payments. The payments may or may not have been missed consecutively.
The borrower is experiencing an unexpected decrease in household income in situations such as a period of unemployment, marital breakdown, health-related issues, loss of a family member, care for a relative or unexpected increase in expenses.
The borrower generally has good job prospects and may be returning to work after a prolonged absence, and may have the ability to afford increased payments at a later date to recapture any missed payments.
The borrower may not have significant equity built up in the property.
The borrower has typically missed up to four consecutive monthly mortgage payments.
The borrower experiences a life-changing event, sudden loss of employment with few prospects of re-employment, permanent disability, or loss of a family member.
The borrower is experiencing very serious financial difficulties. The borrower’s financial situation may be permanent and not expected to improve in the foreseeable future.
The borrower may have minimum equity or no equity in the property.
CMHC’s Homeowner Default Management Team is available to assist you at any time, including before a default occurs and during early stages of payment delinquency. The team has the expertise to help you manage unusual or complex accounts, and is available to respond to your training needs.
Support when you need it most... and just a phone call away!
Claim Payment Centre
1-866-358-9999
This tool is intended solely to assist Approved Lenders in understanding the basics of CMHC's current default management guidance. The user should be aware that this is not intended to be comprehensive, and remains subject to CMHC's formal insurance policies which may contain other conditions, requirements and restrictions and may change from time to time. The tool is not intended to provide financial or other expert advice and should not be relied upon in that regard. It is provided without warranty of any kind, express or implied. Neither CMHC nor any of its employees, agents, or advisors shall have any liability of any kind in connection with use of the tool.
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