The client
A buyer in Cowansville purchased a $365,000 duplex whose two units share one civic address, distinguished only by a unit letter, at 20% down on $6,600/month of their own income.
Purchase price
$365,000, Cowansville
20% down, uninsured, duplex
Unit A's lease (wrong)
$1,600/month
Supplied by the seller as the rent-roll document, in error
Unit B's lease (correct)
$1,150/month
The unit actually being purchased and rented out
Buyer's own income
$6,600/month
Combined with the correct rent's add-back
The problem
A duplex registered as one civic address with two units distinguished only by a letter -- 123A and 123B -- creates an easy filing mix-up whenever paperwork for one unit gets pulled for the other. Nothing about the address itself flags which lease belongs to which side.
How the wrong lease ended up in the file
- ▸The seller owned and managed both units and supplied Unit A's lease to the buyer's file, believing it was the correct one
- ▸The purchase agreement, on its own, was clear about which unit was changing hands -- but the rent-roll document attached to the mortgage file was not cross-checked against it
- ▸Unit A's tenant was paying materially more than Unit B's, so the mistaken lease made the file's rental income look stronger than the unit actually being acquired would support
Nobody had forged or altered anything. Two units at one address simply made it easy to attach the wrong lease to the right purchase.
The numbers
Once the correct unit's lease was confirmed, consolidating the purchase's own math was straightforward.
| Qualifying on the unit actually being purchased | Amount |
|---|---|
| Down payment (20%) | $73,000 |
| Base mortgage | $292,000 |
| Total debt service | Unit A's lease (wrong) | Unit B's lease (correct) |
|---|---|---|
| Monthly rent used for the add-back | $1,600 | $1,150 |
| 50% add-back to qualifying income | +$800 | +$575 |
| Total debt service | 35.5% | 36.6% |
35.5% and 36.6% are both comfortable margins, consistent with the range rental vacancy rate data suggests for a well-located duplex -- the arithmetic was never in doubt. What mattered was which unit's lease actually belonged in the file at all.
The solution
A courtier hypothécaire licensed under Quebec’s Act respecting the distribution of financial products and services treated the civic address as a starting point, not a confirmation of which unit's paperwork actually applied.
First, cross-referenced each lease's own civic address against the property's cadastral designation and registered unit numbers on title, rather than assuming the seller's own file organization was correct.
Second, confirmed directly with the seller which unit -- and which tenant -- was actually included in the sale, in writing, before any rent figure was submitted to the lender, applying the same rental income offset methods either unit's lease would otherwise support.
Third, substituted Unit B's own lease for Unit A's before the file was submitted, closing off the risk that the mortgage would fund against a stronger rent figure than the purchased unit could actually support.
The outcome
The purchase funded conventionally at 5.05%, at 36.6% total debt service on Unit B's own, correct rent; Quebec's welcome tax on the $365,000 purchase came to $3,586.
Because this file is uninsured, CMHC's ratio maximums do not apply directly; the 35.5% and 36.6% figures are informational, showing exactly what the correction changed.
What to take from this file
- 01Two units sharing one civic address, distinguished only by a letter, is a real filing risk. Confirm which unit's documents actually belong in the file before relying on any of them.
- 02A property's cadastral and unit designation on title is the reliable cross-check, not the seller's own internal filing.
- 03A stronger rent figure attached to the wrong unit is not a stronger file. It is a file relying on income the purchased unit was never going to produce.
- 04Confirm which unit and tenant are actually included in the sale in writing, directly with the seller, before any rent figure reaches the lender.
Sources
Every regulatory figure in this file traces to one of these primary sources. Client details and anything that varies by lender are illustrative, as flagged below.
- ▸OSFI — Minimum qualifying rate for uninsured mortgages — the minimum qualifying rate — greater of contract rate + 2% or 5.25%.
- ▸Provincial/territorial mortgage-broker legislation fetched directly (bclaws.gov.bc.ca, legisquebec.gouv.qc.ca, fcaa.gov.sk.ca, web2.gov.mb.ca, nslegislature.ca, assembly.nl.ca) plus FCNB's own site for NB and CanLII's index for PE — see notes for per-province method — provincial mortgage regulators and licence titles.
- ▸Gouvernement du Québec — Droits sur les mutations immobilières — Quebec's transfer duties ('welcome tax') — 2026 indexed brackets.
Illustrative in this file — lender-specific, not rules:
- ▸5.05% contract rate — rates move daily; not a quote.
- ▸the 50% rental add-back convention — each lender publishes its own treatment; there is no universal rule.
- ▸the TDS figures — this is a conventional, uninsured purchase at 20% down -- there is no CMHC ratio ceiling; the numbers are informational.
Authority & provenance
How this case file was built
We publish the origin, the verification method and the reviewer for every case file, so you can judge how far to trust it before you rely on it with a client.
Where it comes from
Derived from files handled by Treadstone’s fulfillment desk and from scenarios contributed by partner brokerages. Names, employers, exact amounts and dates are changed so no client or file is identifiable.
Provenance: Composite — a pattern seen repeatedly on fulfilled files, not a single transaction.
What is verified
Every regulatory figure traces to a primary source listed above and was checked against it on the date shown. The arithmetic is recomputed by machine on every rebuild.
Anything that varies by lender is labelled illustrative rather than stated as a rule.
Who reviewed it
Reviewed for Canadian regulatory accuracy before publication, and re-checked whenever a cited rule changes.
Reviewed by: Nicholas Parson, Treadstone Associates — reviews every case file before publication.
This case file is professional reference material for licensed mortgage professionals. It is not advice to a borrower, and it is not a lender commitment. Insurer rules, qualifying rates and provincial taxes change — confirm the current position with the insurer, regulator or lender before you rely on any figure here in a live file.