CHMC
- Thread starter Darvar
- Start date
- Joined
- Aug 30, 2007
- Messages
- 13,879
QUOTE (Darvar @ Nov 18 2009, 11:42 PM) I wanted to know if you can get the CHMC after you have got a mortgage
no .. why ?
There are three reasons to get CMHC insurance:
a) the rate may be lower, or
b) the loan-to-value might be higher (if that is what you want), or
c) you actually get a mortgage as in some markets that is the only option available that banks will consider
CMHC insures BANKS .. i.e. the bank applies on your behalf. If you don`t pay, the bank in addition to the property has the insurance, i.e. NO RISK to bank.
Under the Canadian bank act, no bank is allowed to lend over 80% loan to value. With CMHC you can go to 85% on apartment buildings or 95% on residential or investment single properties.
The disadvantage of CMHC is that you pay a fee and that you are personally liable in Alberta. In Alberta, if you default on a conventional, up to 80% loan, the bank cannot claim losses against you personally ! Thus, if you let someone else assume your CMHC insured mortgage you may still be liable years later !
no .. why ?
There are three reasons to get CMHC insurance:
a) the rate may be lower, or
b) the loan-to-value might be higher (if that is what you want), or
c) you actually get a mortgage as in some markets that is the only option available that banks will consider
CMHC insures BANKS .. i.e. the bank applies on your behalf. If you don`t pay, the bank in addition to the property has the insurance, i.e. NO RISK to bank.
Under the Canadian bank act, no bank is allowed to lend over 80% loan to value. With CMHC you can go to 85% on apartment buildings or 95% on residential or investment single properties.
The disadvantage of CMHC is that you pay a fee and that you are personally liable in Alberta. In Alberta, if you default on a conventional, up to 80% loan, the bank cannot claim losses against you personally ! Thus, if you let someone else assume your CMHC insured mortgage you may still be liable years later !
- Joined
- Dec 5, 2007
- Messages
- 2,880
I am not sure Darvar`s question was understood. Darvar, the answer is Yes - in the future you can refinance up to 90% for example (depending on the property type and your situation) and then CMHC will be involved. you will then probably get some money out that you can use for whatever you want. However, you`ve just reduced your equity in the property. Cheers.