April 2014 Newsletter
Mortgage before May: Rising mortgage insurance premiums bump up costs
If you’re in the market for a mortgage, and have less than 20% downpayment, then you might want to get that mortgage before May.
For the first time in more than a decade, Canada Mortgage and Housing Corporation (CMHC) is raising premiums for insuring mortgages on Canadian homes: an average 15%. Private insurer Genworth followed suit with a matching increase. Canadian homebuyers are required to have mortgage insurance if they have less than 20% equity in their homes.
How does it hit your wallet? A first-time homebuyer with a $248,000 mortgage and a 5% downpayment will pay an extra $5 per month in insurance premiums. If you are self-employed, a larger fee may apply. We can calculate exactly how much the increase will mean to you.
The change will come into effect on May 1st. Homebuyers will be able to access the current lower rates if they have bought a home and are approved before the May 1 deadline, even if they have a later closing date.
If you’ve got less than a 20% downpayment and are looking to buy this spring, get in touch today!
Looking behind deeply discounted rates
Cheapest isn't always best! Strangely, we know that's true when we're shopping for anything else, but we still tend to believe that lowest rate is the one and only factor in choosing a mortgage. Unfortunately, that low-rate mortgage could actually cost you more in the long run.
A cut-rate mortgage could have you locked in to a very rigid contract filled with financial "trip lines" that could work against you down the road. Sometimes those cut-rate mortgages come with higher fees, penalties, or restrictive terms, which could prove more costly over the long term than a slightly higher-rate mortgage with flexible terms.
Talk to us first. We'll help you find the right mortgage with the rate, flexibility, and freedom you need to be a happy homeowner.
Preventing Identity Theft
Identity theft can cause you huge headaches, but having your house sold without your knowledge is among the worst kind of outcome that can result. Take steps to prevent identity theft and fraud by :
- Checking your credit reports (www.equifax.ca, www.transunion.ca), credit card and bank statements regularly for inconsistencies, unknown charges and unauthorized credit inquiries.
- Not giving out personal information unless you know who you are dealing with, how it will be used, and if it will be shared.
- Protecting your mail and being aware if bills don’t arrive on time.
- Shredding all documents with personal or financial information.
- Safeguarding your PIN and decline the “remember me” on-line option for financial cards.
And speak to us about how title insurance could help protect your home from real estate title fraud!