You may rest assured that MQCC® is Canada’s federal government recognized leader in Quality and Conformity in non-bank, private and private real estate financing transactions.

All MQCC® products conform to statutory and regulatory requirements including:

Alberta: RECA - Real Estate Council of Alberta -

January 22, 2019, Consumer Alert: RECA Urges Vigilance When Engaging in Seller Financing

All provincial equivalent standards

Visit www.mqcc.org to learn more about MQCC’s leadership; or read MQCC® SAFER™

MQCC® SAFER™; Canada National Standard-class, Bank, Non-Bank, Peer-to-Peer (P2P)/Private/Crypto/Secret/Shadow Finance & Creative Finance: "Private Lending" Edition Program-Network for Consumers and Prospective Applicants & Borrowers

At safer.mqcc.org.

PROGRAMS

SEOFAR™ Shared Equity Ownership Financing for Acquisitions & Refinance

How does SEOFAR™ differ from STOFAR™

With SEOFAR™ you and the investor share the OWNERSHIP on using a different legal contract. With STOFAR™ you and the investor share the OWNERSHIP on the TITLE INSTRUMENT.

The MQCC® SEOFAR™ Shared Equity Ownership Financing for Acquisitions & Refinance (SEOFAR™) is a great product and MQCC® MortgageQuote is the only company in Canada who can offer this product to owners of Canadian (or foreign - subject to jurisdiction) delivered in a creative manner that conforms to statutory, regulatory and process requirements.

A shared equity ownership financing arrangement is where MQCC® shares in the upside, while helping you reduce your owner equity (down-payment) requirement at the time of:

purchase
refinance

Perfect for Whom?

Property owners
Property buyers
Property vendors
Real estate investor-lenders
Non real estate investor-lenders

The MQCC® SEOFARTM is designed for persons who seek to own property but do not have the down payment. For qualified buyers who seek to build on their dream of home ownership (or investment property ownership, or investment property construction/development), a MQCC® Private Equity Mortgage (PEM®) investor-lender will (PEM®- IL) assist the qualified buyer or real estate investor by providing financing which can be used as a down-payment or any other purpose, related to the property acquisition or refinance.

Property owners who are selling their property may also use the MQCC® SEOFAR™ program for “vendor-take-back” initiatives.

Structures

The program consists of two structures:

Mortgage evidence of investor-lender financial interest

Shared Equity Mortgage Interest (SEMI™)

Non-mortgage evidence of investor-lender financial interest

Shared Equity Investor-Lender Financial Interest (SEILFI™)

STOFAR™ Shared Title Ownership Financing for Acquisitions & Refinance

The MQCC® STOFAR™ Shared Title Ownership Financing for Acquisitions & Refinance

(STOFAR™) is a great product and MQCC® MortgageQuote is the only company in Canada who can offer this product to owners of Canadian (or foreign - subject to jurisdiction) delivered in a creative manner that conforms to statutory, regulatory and process requirements.

How does STOFAR™ differ from SEOFAR™

With STOFAR™ you and the investor share the OWNERSHIP on the TITLE INSTRUMENT. With SEOFAR™ you and the investor share the OWNERSHIP on using a different legal contract.

A shared title ownership financing arrangement is where MQCC® shares in the upside, while helping you reduce your owner equity (down-payment) requirement at the time of:

purchase
refinance

Perfect for Whom?

Property owners
Property buyers
Property vendors
Real estate investor-lenders
Non real estate investor-lenders

The MQCC® STOFARTM is designed for persons who seek to own property but do not have the down payment. For qualified buyers who seek to build on their dream of home ownership (or investment property ownership, or investment property construction/development), a MQCC® Private Equity Mortgage (PEM®) investor-lender will (PEM®- IL) assist the qualified buyer or real estate investor by providing financing which can be used as a down-payment or any other purpose, related to the property acquisition or refinance.

Property owners who are selling their property may also use the MQCC® STOFAR™ program for “vendor-take-back” initiatives.

Structures

The program consists of two structures:

Mortgage evidence of investor-lender financial interest

Shared Equity Mortgage Interest (SEMI™)

Non-mortgage evidence of investor-lender financial interest

Shared Equity Investor-Lender Financial Interest (SEILFI™)

How much can you get from the PEM®-IL?

Unlike a recently announced “slightly” similar program by the Canada Mortgage and Housing Corporation (CMHC), the amount of funding available from the PEM®-IL may vary according to the circumstances, however the larger the amount, the easier it is for the homebuyer to obtain low-cost financing from a bank with less underwriting requirements and excellent rates. Further, to assure the highest level of flexibility, the PEM®-IL does not necessarily need to be registered on title as a co-owner. Evidence of co-ownership or shared equity may be established in other ways.

MQCC® Leading the Pack in Innovation

This is an innovation in Canadian Finance and only recently, Canada Mortgage and Housing Corporation is “getting in on the action”; see here. And lesser companies are trying to get into the business. (here)

Descriptions of Structure & Repayment Process

The financing (down-payment) may be repaid based upon how it is structured: either as a:

Shared Equity Mortgage Instrument (SEMI™)

Second mortgage is the typical structure.

Shared Equity Investor-Lender Financial Interest (SEILFI™)

The PEM®-IL is registered on title as a co-owner; or,
The PEM®-IL is NOT registered on title as co-owner, but their interest in the property is document on title or by some other means.

Repayment Process

In the case of documenting the SEOFAR™ down-payment as mortgage financing; simple mortgage repayment terms.
In the case of a documenting the SOFA™ down-payment as a shared equity ownership, payments may or may not be required; profit sharing may exist; or an agreement to share on the proceeds of any gain in sale of the asset; or the PEM®-IL may be repaid and removed as an owner upon refinancing by the owner, in their own right.

This is an incredible product. And, ahead of its time, though CMHC and others are finally catching on.

With MQCC: You Realize

THE POWER OF EQUITY®

MEMO FROM CMHC: Canada Mortgage and Housing Corporation
Source

Other CMHC Sources

With this incentive, Government of Canada provides:

5% of a first-time buyer’s purchase of existing homes
5% or 10% of a first-time buyer’s purchase of a new build

The incentive is available to first-time homebuyers with qualified annual incomes of $120,000 or less. A participant’s insured mortgage and the incentive amount cannot be greater than four times the participant’s qualified annual income.

Here’s an example.

Anita wants to buy a new home for $400,000.

Under the First-Time Home Buyer Incentive, Anita can apply to receive $40,000 in a shared equity mortgage (10% of the cost of a new home) from the Government of Canada. This lowers the amount she needs to borrow and reduces her monthly expenses.

As a result, Anita’s mortgage is $228 less a month or $2,736 a year.

The Shared Equity Mortgage Provider (SEMP) Fund program helps eligible Canadians achieve affordable home ownership.

This $100-million lending fund assists shared equity mortgage providers that offer an alternative homeownership model. The Fund will help attract new providers of shared equity mortgages and encourage additional housing supply. The Shared Equity Mortgage Provider Fund is a 5-year program to be launched on July 31, 2019.

The program will offer eligible proponents loans from two possible funding streams:

Stream 1 – Preconstruction

Preconstruction costs to commence new housing projects that provide shared equity mortgages to home purchasers.

Stream 2 – Shared Equity Mortgages (SEM)

Funding of shared equity mortgages provided by the proponent directly to home purchasers.

Note: No stacking is permitted between Stream 1 and Stream 2 under the SEMP Fund. In addition, where there is more demand than available funding, CMHC may prioritize eligible applications to determine where commitments will be made.

Eligible proponents must be:

Non-profit organizations (public or private)
Government (municipal, provincial, territorial)
Indigenous governments or organizations
For-profit organizations (private sector)

All proponents will be required to demonstrate their capacity to administer their proposal. CMHC may prioritize non-profit and government providers before for-profit.

Stream 1 – Pre-construction

Criteria

Proponents must ensure funds are used toward preconstruction costs for the development of projects where shared equity mortgages will be made available to home purchasers who have at least a 5% down payment from their own resources.

A proponent’s commitment to reserving a certain percentage for first-time homebuyers will be considered a strength on the application

Maximum loan amount

The maximum loan amount per project is $4 million.

Maximum Loan Term

The maximum loan term is 5 years. CMHC has the authority to grant exceptions where appropriate.

Interest Rate

A nominal interest rate will be charged on every loan.

Stream 2 – Shared Equity Mortgages

Criteria

Proponents must ensure funds are used to make shared equity mortgages available to purchasers who meet the following criteria:

At least one of the borrowers must be a first-time home buyer as defined under the Government of Canada’s Home Buyers’ Plan, which includes marital breakdown
The borrower must have a 5% down payment from their own resources

Maximum loan amount

The maximum loan amount per proponent/borrower per year is $5 million.

Maximum Loan Term

The maximum loan term is 26 years.

Interest Rate

A nominal interest rate will be charged on every loan.

Memo from Ontario

Did the mortgage brokerage broker mortgages for borrowers or lenders that fall within the Shared Equity Mortgage Programs (SEM)?

Yes

Shared Equity Mortgage Programs (SEM) is an arrangement under which a lender and a borrower share ownership of a property. Please refer to Shared Equity homeownership webpage for more information

Definitions

Conventional: Loan to Value Ratio less than or equal to 80%.
High Ratio: Loan to Value Ratio greater than 80% and insured with mortgage default insurance.
High Ratio - Uninsured: Loan to Value Ratio greater than 80% and uninsured.
Renewals: Mortgages that were originally placed by the brokerage and renewed with the same lender on the same property. Renewals are any extensions of the terms of the mortgage that were not originally contemplated.
Sub-Prime: For the purposes of this return, sub-prime business shall mean arranging a mortgage for individual(s) with a mean credit score of 600 points or less. It is based on the credit worthiness of the individual borrower(s).
Residential: A mortgage entered into with an individual borrower that is secured by a residential property with four units of less, or a single residential unit within a strata condominium.
Commercial: a mortgage entered into with a borrower, lender or investor that is not a residential mortgage.
Construction and development: a mortgage entered into with a borrower, investor or lender for the purpose of financing the construction of a building or property development project.
Equity-Based Lending (or Asset-based Lending): the generic term for mortgage lending based primarily on the value and marketability of the real estate property collateral and other additional securities. Some examples of equity-based lending solutions offered by 'Alternative Lenders' are Stated Income. No Income Qualifier (NIQ), No Doc, or Self-Employed Mortgages and require little or no income documents, relying on risk mitigation strategies by knowledgeable brokerages.
First-time homebuyer mortgage: mortgages with 1 or more first-time homebuyer borrowers.
Bridge Loan Mortgage: A short-term loan usually backed by some collateral, used until a borrower secures permanent financing or pays an existing obligation. These would not include bridge loans provided by the lender offering permanent financing.

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MQCC® Meta Quality Conformity Control Organization Incorporated as MortgageQuote Canada Corp.

Head Office: 548 Rundleridge Drive NE, Calgary, Alberta, Canada T1Y-2K7

Services available to Canadians, Non-Resident Canadians, Foreign Investors and Foreign Nationals

www.mqcc.org

Email is preferred method of communication: info@mqcc.org

Table of Contents

Introduction to MQCC® SOFA™

Helping All Types and Economic Classes of Property Owners

Corporations

Organizations

Individuals

Low-Income (individuals and families)

Average-Income (individuals and families)

Higher-Income (individuals and families)

MQCC® = CONFORMITY to Statutory and Regulatory Requirements

PROGRAMS

SEOFAR™ Shared Equity Ownership Financing for Acquisitions & Refinance

How does SEOFAR™ differ from STOFAR™

Perfect for Whom?

Structures

STOFAR™ Shared Title Ownership Financing for Acquisitions & Refinance

How does STOFAR™ differ from SEOFAR™

Perfect for Whom?

Structures

How much can you get from the PEM®-IL?

MQCC® Leading the Pack in Innovation

Descriptions of Structure & Repayment Process

Repayment Process

MEMO FROM CMHC: Canada Mortgage and Housing CorporationSource

Memo from Ontario

Definitions

MEMO FROM CMHC: Canada Mortgage and Housing Corporation
Source