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CMHC fully guarantees Canada Mortgage Bonds issued by Canada Housing Trust No. 1 for timely payment of principal and interest.
CMHC’s Guarantee carries the full faith and credit of Canada and constitutes a direct unconditional obligation of Canada. Amounts payable of the principal and interest are payable out of the Consolidated Revenue Fund of Canada.
The CMHC Guarantee
The following CMHC Guarantee is set out on the Canada Mortgage Bonds and, if issued, on each bond in definitive form:
"Canada Mortgage and Housing Corporation as agent for Her Majesty in right of Canada hereby guarantees the timely payment of the principal and interest set forth in this instrument in accordance with the terms and conditions of this instrument, pursuant to the powers given to it in Sections 4 and 14 of the National Housing Act, R.S.C. 1985, as amended, which expressly provide that ‘Every right or obligation acquired or incurred by the Corporation under this Act, whether in its name or in the name of Her Majesty, is a right or obligation of Her Majesty' (Section 4), and ‘The Corporation may guarantee payment of any or all principal or interest, or both, in respect of securities issued on the basis of housing loans’ (Section 14). It is certified that no provision of any law or contract adversely affects the rights of the holder to the benefit of this guarantee.”
The CMHC Guarantee ranks equally with all of CMHC’s other unsecured and unsubordinated indebtedness and obligations from time to time outstanding.
