An Insured Mortgage covered by Mortgage Default Insurance is called an Insured Mortgage.

Lenders apply for Default insurance, this default insurance covers the lender (not the borrower) against any losses related to borrower default and foreclosure. Currently, there are three insurers in Canada; CMHC, Canada Guaranty and Genworth.

Each of these insurers offers two types of insurance coverage.

Transactional Insurance, referred to as a High Ratio Mortgage: The one-time premium is added to the requested mortgages with Loan to Values greater than 80% (sometimes added to lower LTV’s in unique situations). This insurance premium is added to the mortgage balance at the time their mortgage is advanced. Lenders pays the insurers and the Borrowers are responsible for paying the insurance premium. The insurance premium is tiered and reduces, in case clients puts more down payment.  You can see a full breakdown of the premiums here

Portfolio Insurance or Bulk Insurance: This insurance is applied to mortgages with Loan to Values less than 80%.  Most often borrowers are not even aware that this coverage has been purchased as the premium is paid for by the lender or bank.  Mortgage Lenders like First National, Manulife, Marathon and MCAP have used this type of coverage on all the mortgages they fund. Big Banks also use this insurance to a lesser extent.  Mortgage Lenders buy this type of insurance in order to offer better  mortgage rates.

Since default insurance is added to help protect the lender, insured mortgages are viewed as a more secure and therefore borrowers often receive lower rates.

Contact your Finser Mortgage Broker or Agent to help you find the right mortgage solution suitable to your needs.

first time home buyer mortgage,

Six steps to get a Perfect First time home buyer Mortgage.

A first time home buyer mortgage is the mortgage a first time home buyer takes to purchase the home of their dreams. These kind of borrowers seem incredibly attractive to lenders as they are less risky than other borrowers. They do not have many loans and are not drowning in debt. There are quite some rewards to getting a mortgage as a first time home buyer. Here we have listed 6steps to the best and the quickest first time home buyer mortgage for yourself:

First time home buyer mortgage


Steps to Get a First time home buyer Mortgage:

1. Hire a broker:

Yes, this is the first tip for a first time home buyer looking for a mortgage. Even though most people consider a mortgage broker an expense, what they fail to realize is that they could help you save a lot of your hard-earned dollars with the help of exclusive schemes and expertise. They have been in the field for quite a while and will also have dealt with plenty of mortgage borrowers who are first time home buyers. So, it would only work in your favor to hire a mortgage broker.

2. Get pre-approved:

Pre-approval has almost become synonymous with the first time home buyer mortgage process. Pre-approval refers to the process of finding out how much you can afford. It involves receiving an approximate figure which is quite close to the finances you would be receiving in the form of a mortgage as a first time home buyer. This helps you to make decisions with a budget in mind thereby preventing you from any disappointments. It also helps you look profoundly serious when you talk to a seller. It could give you the competitive edge you are looking for with the seller.

3. Go house hunting early:

With a mortgage pre-approval in hand, you can now finish your house hunting process with vigor. Start searching for houses and you will find many listing to suit your first time home buyer needs. This is probably the most exciting part of the entire process. The earlier you start, the faster you would be able to complete the process. It will also allow time for scouring other neighborhoods which were not initially on your list. All of this with the guarantee of a fixed amount in payment could make the process a lot quicker than you would imagine.

4. Choose your mortgage:

After the process of home hunting is over, the duties of the first time buyer will kick in. In this step, you need to sit down with your mortgage broker and find the right plan which will fulfill all your requirements. Since you have a pre-approval in hand already, mortgage brokers will use it as a base to give you the mortgage. Negotiate it down to a reasonable rate and choose the perfect mortgage for yourself.

5. Talk about the costs involved:

The payment for the home will not be the only cost you incur for your mortgage as a first-time buyer. There could be a lot of costs involved which you may be unaware of. Make sure you are made well aware of the costs, hidden or visible. As a result, this can help you find out if your mortgage lender is duping you or not. Mortgage brokers can help you see through the red flags in the documents and assist you in finalizing the perfect mortgage for your needs. It is also advisable to keep a small portion of your mortgage amount separately for such hidden costs so that you are not surprised when they do show up.

6. Save early for your down payment:

The down payment is a very integral step to getting your mortgage. Depending on your financial status, credit score and income, you would be assigned to pay a certain amount as down payment for your first time home buyer mortgage. This down payment needs to be saved Certainly for and then paid off promptly to ensure a quick and comfortable process for the first time home buyer mortgage process. After all the processes have been completed to the dot, it is time to sign on the dotted line and claim your mortgage. You can then take custody of your home and have a happy stay there.

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home buying

Buying your first home can be both exhilarating and terrifying. It’s a bit like riding a roller coaster – there is the thrill of the ride, yet there can also be fear of the unknown. Oftentimes, when first-time homebuyers apply for a mortgage, they are not sure what kind of mortgage to apply for. They may also be uncertain of how they should be managing their own finances during this new phase of their lives.

If you are thinking about purchasing your first home, a mortgage advisor can help you manage some of the ups and downs of this important transaction.

Here are five tips that first-time home buyers should follow when they apply for a mortgage.

  1. Manage your existing debt

Before applying for a mortgage, consider how much debt you already have and what your monthly payments are. A mortgage professional can help you understand how much you will be able to afford in mortgage payments once your current debt payments and other expenses are taken into account.

  1. Consider all homebuying costs

Don’t make the mistake of thinking that you only need a down payment to get into your first home. First-time homebuyers have to consider other expenses as well such as appraisal fees, mortgage insurance, and closing adjustments. By making sure that you are aware of all possible costs, you won’t be caught off guard with unexpected expenses.

  1. Don’t put your finances under too much pressure

Just because you can qualify for a certain mortgage amount, doesn’t mean you have to buy a home worth that full amount. Owning a home has a number of expenses associated with it other than mortgage payments. These include property taxes and maintenance. Giving your finances a little extra breathing room can help you to relax and enjoy your new home all the more.

  1. Explore different types of mortgages

Many first-time home buyers automatically default to applying for a fixed rate mortgage, but this may or may not be the best type of mortgage for you. Your mortgage broker can help you determine the best type of mortgage to fit your needs and your circumstances.

  1. Use a mortgage broker who will shop around for you

Don’t assume that the financial institution that you bank with is your best option for a mortgage. Just like you would shop around for a phone plan to get better rates, it is important to shop around for the best mortgage rates. A small difference in your interest rate could translate into thousands of dollars over the life of your mortgage. Mortgage brokers have access to a large pool of lenders that they can shop around with to get the best rate for you.

Buying your first home is a big step and having a professional mortgage broker to assist you is a great way to make sure that everything goes smoothly. To learn more or book a consultation, call the team at Finser Mortgages at 1-855-534-6737.