New S61 Mortgage Prepayment Deadlines

For a limited time, S61 co-ops can apply to pay out their high-interest Canada Mortgage and Housing Corporation (CMHC) mortgages without penalty. To do so, they will have to qualify for a loan from the private market where they will enjoy the benefit of lower interest rates. (Loan applicants will be asked for a current Building Condition Assessment (BCA).) After payout, co-ops may find their mortgage payments have decreased, although this will depend on whether or not—and how much—they also borrow for capital repairs to their property.

Although the co-op’s operating agreement ends when the CMHC mortgage is paid off, rent supplements continue for low-income households, usually until the date of the original operating agreement expiry. S61 co-ops that prepay their mortgage can continue to receive the Agency’s helpful reports on their finances by subscribing to our Annual Health Check service.

To date, CMHC has waived approximately $100 million in penalties on the payout of long-term non-renewable mortgages. Do not delay in applying since 2019-20 is the last year CMHC will offer this initiative. CMHC will accept applications during four successive rounds, as shown below. Take note of the deadlines below and head to CMHC’s website for more information. E-mail your questions to prepayment@cmhc.ca. Help making an application is also available from CHF Canada.      

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