Just a friendly reminder that effective May 1st 2014, the premium to insure a high ratio mortgage through the Canadian Mortgage and Housing Corporation (CMHC) will be increasing. Here are a couple links to some reference material and a chart outlining the changes.
- CMHC to Increase Mortgage Insurance Premiums
- Increase in CMHC Mortgage Loan Insurance Premiums — Key Facts
|Total Loan to Value Ratio||Standard Premium (Current)||Standard Premium|
(Effective May 1st, 2014)
|Up to and including 65%||0.50%||0.60%|
|Up to and including 75%||0.65%||0.75%|
|Up to and including 80%||1.00%||1.25%|
|Up to and including 85%||1.75%||1.80%|
|Up to and including 90%||2.00%||2.40%|
|Up to and including 95%||2.75%||3.15%|
So is this a really big deal? Well... as Jackson Middleton mentioned when CMHC originally announced the insurance premium increase, "no one is excited about paying more in insurance premiums"... but for the average home buyer putting down 5%, "the monthly increase in CMHC premium equals the cost of a cup of coffee and bagel".
If you want to talk about how these changes to the insurance premiums will impact your mortgage, please contact us anytime!