Mortgage default insurance, commonly referred to as mortgage insurance, allows borrowers to achieve home ownership in Canada with as little as 5% down.
In other words, mortgage insurance is an insurance policy that the bank takes out to protect themselves against your defaulting on the loan. They pass the costs on to you, typically it is added to the mortgage balance and included in your regular payments. Keep in that there is 8% PST on the mortgage insurance premium that cannot be added to the mortgage amount and it becomes part of your closing costs.
This is a question often asked and there is going to be a different answer based on your own situation and of course the current market conditions in your area. There are some questions that I can answer, such as whether it is a buyer’s market or a seller’s market. It’s important that the answers to these questions are based on the right demographic for your potential purchaser and also yourself as a seller. For example, the overall market in your area might be a buyer’s market, however, if you are the only seller in the area that has a sought after property, you might be in a stronger position. Maybe there is a shortage of properties in a certain price bracket and that is what you own… then your case is going to be different to the overall market.
There are some options for you to way up because you will be asking yourself:
=> Buy First- You have found and bought your dream home before you've sold your current home and you are faced with carrying two mortgages for a while – what will you do?
=> Sell First- You have a fabulous purchaser and offer for your existing home before you've found your next home, and you may find yourself living with family, friends, or in a hotel. This might occur if you haven’t found your new home or if convenient closing dates cannot be negotiated – is it worth it?.....
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