CMHC increases their premium

Sunday, 02 March 2014 00:00 Written by  Published in Real Estate Read 3145 times
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If you are thinking of buying a home this year, here's some information that I would strongly suggest that you pay attention to and follow up with action.

They say knowledge is power, but APPLIED knowledge is POWERFUL...Note the difference and ACT accordingly!!!

CMHC is increasing its mortgage insurance premiums for homeowners and 1-4 unit rental properties effective May 1, 2014. Under the current system, a borrower would pay an insurance premium of $6,875 on a $250,000 mortgage. With CMHC’s increase, that same borrower will now pay a premium of $7,875 ($1,000 more).

On a typical 25 year mortgage, with an interest rate of 3.5%, the increased premium results in about $5 more a month.

The change will only apply to mortgages underwritten after May 1, 2014 and it will apply to all homeowner business from that day forward as a result of increasing capital targets. Premiums will rise about 15 per cent, according to CMHC, though it isn’t expected to have a major effect on the housing market.

Click here to read full article on the CMHC website. 

Last modified on Monday, 03 March 2014 21:54
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