Tag Archives: James Wong The Mortgage Group

CMHC Mortgage

CMHC Mortgage is a high ratio mortgage when the down payment provided by a home buyer is less than 20% of the purchase price of a home. In Canada CMHC, Genworth Financial and AIG are 3 insurers that provide high ratio mortgage insurance to home buyers who are buying their homes with less than 20% down payment.

Home buyers can buy with as little as 5% down payment if they are qualified for high ratio mortgages.

If you are a first time home buyer, check out if you are qualified to withdraw your RRSP savings as down payment. You should also find out if you are exempted from paying the British Columbia “property transfer tax”.

The CMHC mortgage insurance premium charged is dependent how much down payment is provided by you. The CMHC insurance premium may range from 1.00% to 2.75% of your mortgage amount.

Buying with 5% down payment

The less down payment you provide, the more fee you need to pay. This insurance fee can be paid up front or added to your home mortgage. If you plan to buy a home with 5% down payment and get a high ratio mortgage, check with your bank or your local mortgage broker whether you can be approved for CMHC mortgage financing.

The 5% down payment can come from different sources such as lender’s cash back incentives, lines of credit/credit cards, arm’s length personal loans or gifted down payment. For more information on applying for a mortgage, click on this link to my website: Vancouver Home Mortgage.