In announcing the consultation, the department noted that “the Canadian housing finance system is sound, with strong foundations that promote financial stability, including robust regulation, prudential supervision of regulated financial institutions, and high underwriting standards.”
However, in order to maintain the stability of the system, the government is considering whether mortgage lenders should manage a “modest portion” of loan losses that default.
The consultation runs until the end of February 2017 and details are on the Finance Canada website
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A consultation has been launched by the Department of Finance Canada to assess whether lenders should share the burden for defaulted mortgages backed by CMHC.