Rules Changed for Mortgage Insurance
A quick update for anyone who missed the announcement. The Government of Canada has passed Bill C37 which changes the minimum loan to value amounts for conventional mortgages.
What does this mean to you? In the past if you were borrowing more than 75% of the purchase price, or value of the property, you had to get CMHC or Genworth mortgage insurance. Now that Loan to Value amount has changed so that there is no need for high ratio mortgage insurance if you are borrowing less than 80% of the homes value. This move will save you a large chunk of change (over a thousand dollars) if you can come up with a 20% downpayment. For those that had been saving up to have a 25% downpayment and avoid the insurance premium, you can now put 20% down on a larger or better home, or spend the extra 5% on furniture, upgrades or savings.
