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June 01, 2020 | Tyler Difley

Mortgage matters: options and advice for anyone falling behind on payments due to COVID-19

As the COVID-19 pandemic continues, many Calgarians have lost their jobs, been furloughed (i.e., temporarily laid off) or seen their working hours reduced. If this has happened to you and you own a home, the loss of income could, understandably, make it difficult to keep up with mortgage payments.

If you are in a situation where you're having trouble making payments or know you cannot pay your mortgage, Canada Mortgage and Housing Corporation (CMHC) recommends exploring a variety of options.

According to CMHC, the first step is to contact your mortgage professional to make sure they fully understand your financial situation. This includes the details of other debt obligations – such as credit cards, additional loans and household bills – as well as your current income and any assets.

At this point, your lender can walk you through your options for reducing or delaying your payments. According to CMHC, those options might include any of the following:

  • Mortgage payment deferral

    • A pause or suspension of payments for a specified period

  • Amortization period extension

    • Extending the original repayment period for your mortgage could reduce your monthly payments

  • Addition of arrears to the mortgage balance

    • It might be possible for your lender to add any missed payments (i.e., arrears) to your mortgage balance and spread out the financial hit over the remaining repayment period

  • Special payment arrangement

    • Your lender might be able to provide a unique solution that fits your financial situation

Deferrals demystified

Among the options listed above, mortgage payment deferral has been the most highly publicized during the COVID-19 outbreak. CMHC is working with financial institutions to offer deferrals of up to six months for eligible homeowners with CMHC-insured mortgages. If your mortgage is not CMHC-insured, you could still be eligible for a deferral at your lender's discretion.

However, a deferral merely delays mortgage payments, it does not cancel them entirely. According to CMHC, "The interest that hasn't been paid during the deferral period continues to be added to the outstanding principal of your mortgage. This can affect the total amount you owe in accordance with the original payment schedule."

In other words, at the end of your deferral, your regular payments will likely increase to ensure you can still pay off the mortgage by the end of the original amortization period.

To determine your eligibility or request a mortgage payment deferral, contact your lender:

  • ATB Financial – 1-800-332-8383

  • B2B Bank – 1-800-263-8349

  • BMO – 1-877-895-3278

  • Bridgewater Bank – 1-866-243-4301

  • CIBC – 1-800-465-2422

  • CMLS Financial – 1-888-995-2657

  • CWB Optimum Mortgage – 1-866-441-3775

  • Equitable Bank – 1-888-334-3313

  • Connect First Credit Union – 403-736-4000

  • Chinook Financial – 403-934-3358

  • First Calgary Financial – 403-736-4000

  • First National Financial – 1-888-488-0794

  • Haventree Bank – 1-855-272-0051

  • Home Trust Company – 1-855-270-3630

  • HSBC – 1-888-310-4722

  • ICICI Bank – 1-888-424-2422

  • Manulife Bank – 1-877-765-2265

  • MCAP – 1-800-265-2624

  • Merix Financial – 1-877-637-4911

  • Marathon Financial – 1-855-503-6060

  • RBC – 1-800-769-2511

  • RFA Bank of Canada – 1-877-416-7873

  • RMG Mortgages – 1-866-809-5800

  • Scotiabank – 1-800-472-6842

  • Servus Credit Union – 1-877-378-8728

  • TD Canada Trust – 1-866-222-3456

For more information and the latest updates about CMHC's response to COVID-19, click here.

Tagged: amortization | balance | Calgary | Calgary Real Estate | Calgary Real Estate News | Calgary Real Estate News | Canada Mortgage and Housing Corporation | CMHC | Coronavirus | COVID-19 | COVID-19 | Debt | Economy | Feature | Finance | Housing Market | insurance | lender | Mortgage | mortgage professional | Payment

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