All About Mortgage Insurance

Mortgage insurance makes it possible for homebuyers to purchase a home using a lower down payment. The Canadian Bank Act prohibits most federally regulated lending institutions from providing mortgages without mortgage loan insurance for amounts that exceed 80% of the value of the home or purchases with less than 20% down payment. The Canadian Mortgage and Housing Corporation (CMHC) and Genworth Financial are two companies that offer Mortgage Loan insurance. For more information please visit their websites at www.cmhc.ca and www.genworth.ca.

 

CMHC and Genworth Financial’s current Mortgage Loan insurance Premium Rates*:
Loan Size
(% of property value)
Rate (as a % of loan)
Up to and including 65% (over 35% down payment)
0.5%
Up to and including 75% (25% to 34.99% down payment)
0.65%
Up to and including 80% (20% to 24.99% down payment)
1.00%
Up to and including 85% (15% to 19.99% down payment)
1.75%
Up to and including 90% (10% to 14.99% down payment)
2.00%
Up to and including 95% (5% to 9.99% down payment)
2.75%
Up to and including 95% Flex Down or Cash Back Equity Owner-Occupancy Program** (5% to 9.99% down payment)
2.90%

*An additional 0.2% is added to all mortgages with amortizations of 26 to 30 years. An additional .4% is added to all mortgages with amortizations of 31 to 35 years.

**Not all Financial Institutions offer CMHC’s Flex Down and/or Genworth Financial’s Cashback Equity Owner-Occupancy Program.

Below is a brief summary of the two programs:

CMHC’s Flex Down

Own your own home sooner by using a wider range of sources for your down payment. If you have a proven track record of meeting your debt requirements and sufficient income to support mortgage loan payments, your lender may be able to provide you with CMHC’s Flex Down product. Sources for your down payment can include: borrowed funds, gifts and lender cash back incentives. For more information click here.

Genworth Financial’s Cashback Equity Owner-Occupancy Program

Some home buyers have an excellent credit history but have not yet saved the required down payment. Others have used their savings to build assets in different ways. Genworth Financial offers mortgage default insurance to both these groups. For more information click here.

 

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