CMHC (Canada Mortgage and Housing Corporation) announced today that they will be raising the insurance premiums in order to insure mortage loans by up to 15% depending on how much money a Buyer has to put down on their mortgage.
Many home Buyers only have 5-10% to put down on their mortgage, unless they have a 20% downpayment then they will need to have their mortgage insured by 1 of the 3 mortgage insurance companies that we have here in Canada - CMHC, Genworth or Canada Guaranty. It will be interesting to see if the other 2 companies follow suit.
Overall this increase could add thousands of dollars to the overall purchase price when amortized over a number of years. CMHC estimates this increase will only add on average about $5/month.
Certainly nothing to panic about and isn't expected to affect the housing market adversely. But for those Buyers concerned about having mortgage insurance premiums it is good information to have.
CMHC raises premiums - Tips from your local South Surrey/White Rock Realtors
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