I'm not really sure cmhc foreclosing on itself is a big issue. You can default on your own home that is funded by your own rrsp. It's weird but it happens. I would wonder if the 10% share would be held in a thrid party trust that protects against foreclosure. So the 10% is priority even before the bank holding the mortgage. They can prioritize it any way they want.
I'm more curious to know if the 10% goes up or down with property values. I assume again that it would be an interest free and non negotiable term at the end. So it wouldn't change as a value. 10% becomes 2% if the value goes up and vice versa down. But I'm not sure they've determined that yet.
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