Understanding Mortgage Insurances

There are a number of misconceptions in the world of mortgages when it comes to the word “insurance” let’s cover the various meanings off.  High Ratio Insurance: Also known as CMHC, mortgage default insurance, Portfolio Insurance In Canada, all Banks must have this insurance on any mortgage they lend on with less than 20% down payment.  It is a one-time premium paid by the borrower (normally included into the mortgage)to the insurance company that insures the lender if the borrower ever defaults on the mortgage, the lender gets all of their money back. Three companies in Canada offer this insurance, CMHC which is owned by the Government, as well as Genworth and Canada Guaranty.  CMHC insurance is backed 100% by the Canadian Government, the other two are 95% backed by the Government.  This has been a source of discussion recently as CMHC has neared it’s legal insurable portfolio limit of $600 billion in mortgages. If your mortgage is insured, what does that mean for you?  Very little unfortunately…the benefit is to the lender, though as long as you pay your mortgage, that insurance will never need to be used.  The one benefit to having a insured mortgage is that it […]

The What If’s in Life with Life Insurance- Staring out the Canadian Glass Window

What if I lose my job, What if I get injured, What if I die,What if this What if that.. blimey, are you tearing your hair out? Are you thinking about life insurance yet? Sometimes preparing for the future seems like it’s silly but perhaps it’s just a way to put off the inevitable. Some people I know didn’t think they needed life insurance or thought it was only something senior folks think about. Scenario:  Older Couple who never purchased Life Insurance Little Savings Age 50’s with children/grandchildren Mortgage until they are in their 70’s Little Investments Health Status- bad Heart Condition, Diabetes Source: EverydayHealth.com What we do know for sure is: We WILL all DIE! Face it mates, it’s going to happen whether you like it or not. ** Note: if you are reading this and have some sort of secret potion to prolong this send me a quick email so we can meet up** If you plan to remain single and childless for the rest of your life and have money put aside for your funeral costs then you can sweep the insurance idea under the mat. Do you really need to pay for Life Insurance when there […]