Mortgage insurance market heating up

National Post-  Mortgage default insurance is something you have to pay if you can’t come up with a 20% down payment on your house.

You pay the premium and the insurance covers the bank in the rare event — defaults in this country are still below 1% — you don’t make your mortgage payments. But it is a transaction between your bank and your mortgage insurer.

So, why should you care about the mortgage default insurance market and another new entrant into the market…?

Mortgage insurance market heating up

Housing market expected to moderate this year and next: CMHC

 

Financial Post- Canada’s housing market is expected to ease in 2010 and 2011 as the market returns to more balanced conditions, Canada Mortgage and Housing Corporation said Wednesday.

"Canadian housing markets have recovered from the low levels posted in early 2009," Bob Dugan, chief economist for CMHC, said in a release.

"Moving forward, housing starts will moderate as activity becomes more in-line with long term demographic fundamentals. New measures for government-backed mortgage insurance introduced by the government of Canada that took effect on April 19, 2010 will continue to support the long-term stability of Canada’s housing market…”

Housing market expected to moderate this year and next: CMHC

Loophole may help banks to lend to first-time buyers

Financial Post- There is a small loophole in the new federal mortgage rules that could make it easier for the banks to lend out money to first-time buyers.

The federal government announced last month new requirements for anyone borrowing money for a house and needing mortgage insurance. If you have less than a 20% down payment and are borrowing from a financial institution covered by the Bank Act, you have to take out mortgage default insurance, which ensures the banks are covered for any losses resulting from payment defaults.

For principal residences, the new rules force consumers to qualify for a loan based on being able to make payments on a five-year fixed-rate mortgage, which has a much higher interest rate than variable mortgages, now as low 1.85%…

Loophole may help banks to lend to first-time buyers

New mortgage rules target select few

Financial Post- The new mortgage rules coming into effect April 19 may prevent some cashless couples from buying a house until they can muster a 10% down payment, but they have largely drawn a yawn from the real estate industry. The real target? Real estate investors, who will now have to come up with a 20% down payment to take on their next property or be forced to buy mortgage insurance.

Finance Minister Jim Flaherty said as much in announcing the changes. "The measures will not affect the ability of a Canadian family to buy a house. It will affect those who are speculating," Flaherty said. "What we’re getting at is the speculation in multiple condominium units in particular which we see in Vancouver, Montreal, Toronto and in some other places in Canada…"

New mortgage rules target select few

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