Canada Mortgage and Housing Corporation is hiking premiums for mortgage insurance on its highest-risk borrowers.
Home buyers who put down less than 10% down payment will see their insurance premiums jump 15% starting in June 2015.
According to 2014 figures, borrowers who bought homes with a down payment of just 5% typically took on about $252,000 in mortgage debt, the housing agency said, and will see premiums rise by $5 a month.
- The new rate for a loan-to-value ratio up to 95% is 3.6%
- For a loan-to-value ratio from 90.01 to 95%, but a non-traditional down payment, the premium climbs to 3.85%
The premium increase for homebuyers with less than a 10% down payment, reflects CMHC's target capital requirements which were increased in mid-2014.
The federal agency is the country's largest insurer of home mortgages.
Article from: www.bnn.ca