1. Access to Better Interest Rates
Because of the protection mortgage insurance offers lenders, it then allows the lending company to offer homebuyers access to better interest rates. This works to consolidate the cost of the home for the buyer.
2. Offers Access to the Marketplace for Many Buyers
Homebuyers who are self-employed or don’t otherwise have access to steady income may also benefit from mortgage insurance. Mortgage insurance ensures that buyers outside the traditional marketplace can qualify for a low cost mortgage while keeping the lender’s interests protected.
3. Mortgage Insurance can be Transferred
Another advantage of mortgage insurance is that it can be transferred from one property to another. This means that owners looking to purchase a new property can simply save their premiums over time and transfer their insurance to the new property. By maintaining this payment record over time, owners can show lenders they’re trustworthy, potentially limiting their future purchase costs.
4. Allows Buyers to Purchase with a Smaller Down Payment
The use of mortgage insurance also now means that buyers with only a small down payment can enter the marketplace. Buyers can use insurance through the CMHC and will only have to pay 5% down on their property. This gives first-time buyers and others with limited resources the flexibility to enter the marketplace.
5. May Protect Buyers in Case of Job Loss
The consistent payment of mortgage insurance premiums can help protect the homeowner in case they lose their income for a short period of time. This could be vital for Canadians with growing families, and offers a way to avoid the stress and financial hardship associated with a period of unemployment. Lenders now offer a series of insurance options to help specifically manage time when homeowners are out of work, ill or otherwise unable to pay their financing costs.
The mortgage insurance product is now offering millions of Canadians access to the wider real estate marketplace, by protecting lenders and safeguarding homes. To learn more on insurance and the benefits it provides to homeowners, contact our expert team today.
source: northwoodmortgage.com
