Apartment Building - CMHC Insured = Residential Financial Conditions?

[Nir]

Hi All,

If I recall correctly, Mr. Thomas Beyer mentioned in a previous thread that insuring an apartment building (say 10-plex with 2 commercial units/stores) with CMHC allows you to get residential financing conditions and this includes the option to get a variable interest rate mortgage instead of fixed rate which you must take unless you are CMHC insured.

Is this still the case or have the rules changed making it much more difficult to get a variable rate mortgage for an apartment building EVEN WHEN CMHC INSURED?

THANKS.

 

[Thomas Beyer]

QUOTE (investmart @ May 9 2010, 12:39 PM) Hi All,

If I recall correctly, Mr. Thomas Beyer mentioned in a previous thread that insuring an apartment building (say 10-plex with 2 commercial units/stores) with CMHC allows you to get residential financing conditions and this includes the option to get a variable interest rate mortgage instead of fixed rate which you must take unless you are CMHC insured.

Is this still the case or have the rules changed making it much more difficult to get a variable rate mortgage for an apartment building EVEN WHEN CMHC INSURED?

THANKS.
For an apartment building, you will NOT be able to get a variable rate mortgage with CMHC.

It is either a 5 years or in some instances are 10 year FIXED mortgage as the money comes usually from a CMHC issued mortgage bond.

The only time you can get variable rate mortgages is after 5 years, when you re-finance with a new bank.

Why would you want a variable rate anyway with 5 year fixed rates at around 4.2% ?