News Update in the Mortgage Market:
CMHC (Canada Mortgage and Housing Corporation) increases mortgage insurance premiums to 15%, effective May 1, 2014. The premiums are for homeowners and 1-4 unit rental properties.
The rise will only apply to those mortgages unwritten after May 1, 2014 and will apply to all homeowner business from that day, forward.
It is not be expected to have a major effect on the housing market.
During the media conference call, Peter De Barros, CMHC’s executive director of communications said, “In 2013 the average CMHC insured loan at 95 per cent loan to value ratio was $248,000; using these figures a higher premium will result in an increase of approximately $5 to the monthly mortgage payment for the average Canadian homebuyer. This is based on a five-year term using current mortgage rates and 25 year amortization.”
CMHC mortgage insurance premiums are reviewed each year and is planned to make premium announcements in Q1 of every year going forward.
To see the full article from Mortgage Broker News, click here.
If you have any questions regarding the CMHC mortgage premium increase, please give us a call at 604-588-4466 or email us at email@example.com