We will be better off now than when we were renting. We won't keep lining someone else's pocket. The mortgage payments are going to be half what our rent was, including taxes. Mortgages for more than 75 percent of the sale price legally require mortgage insurance to protect lenders should the borrower fail to repay the mortgage debt. CMHC and private insurer GE Capital Mortgage Insurance Canada are the only two suppliers of mortgage insurance.
Borrowers pay the one-time premium when the mortgage is set up.
Most buyers add the premium to the mortgage balance and save their cash for closing and moving expenses. Premiums are based on the size of the mortgage as a percentage of the sale price. And we had to buy insurance from CMHC but given that was all we could afford to come up with, it just seemed to be the best way to do it. Check your credit in the Credit Center. Written by PJ Wade Click here for a printer-friendly version of this article.