Who guarantees timely payment of interest and principal in the Canadian Mortgage Bonds Program?

The Canadian Mortgage Bonds Program is designed to enhance the availability of mortgage financing in Canada by providing a secure investment vehicle for investors. The guarantee of timely payment of interest and principal for these bonds is provided by the Canadian Mortgage and Housing Corporation (CMHC). CMHC plays a crucial role in supporting Canada's housing market and ensuring the stability of the mortgage industry.

By guaranteeing mortgage bonds, CMHC instills confidence among investors, which facilitates more funding for residential mortgages. This, in turn, allows lenders to offer more competitive rates to homebuyers, creating a positive ripple effect on the housing market and the overall economy. The involvement of CMHC is significant as it underscores the government's commitment to ensuring accessible mortgage options for Canadians while managing risk in the mortgage finance system.

The other options, while related to finance and sometimes involved in mortgage lending, do not provide the specific guarantee of timely payments associated with the Canadian Mortgage Bonds Program, which is a unique responsibility held by CMHC.