Insured, Insurable, and Uninsurable Mortgages

Category: Renew Refinance,

Insured Insurable and Uninsurable Mortgage Chart

Mortgage Interest Rate Tiers

Since we know that lenders can back-end insure our mortgages (please read our Mortgage Insurance Market and Wholesale Lenders article first), and that this specifically makes these mortgage investments more attractive to investors, what does it mean for borrowers (every day people like you and me)?

To recap, any mortgage that is inexpensive for a wholesale lender to get financing for allows the lender to pass on savings to their clients, meaning mortgages that are insured get the best rates! An insured mortgage is where a borrower pays the mortgage default insurance because they have less than 20% down payment and is required on all mortgages where the down payment is less than 20%.

But, lenders can also pay for insurance for their client! An “insurable” mortgage is one where the clients puts 20% down (or more), and their mortgage is approved as though a client is paying for insurance, but the actual insurance is paid for by the lender.

Rates for insurable mortgages are generally very similar to insured mortgages. An “uninsurable” mortgage is one where mortgage insurance is not available.

The graph below outlines what type of mortgages are insured, insurable or uninsurable.

Insured Insurable and Uninsurable Mortgage Chart
Mortgage interest rate tiers for insured, insurable, and uninsurable mortgages.

So what does this all mean for you, the borrower?

If your mortgage is insurable, you may be able to get the best rates. What is interesting to note is that if you have a mortgage that was previously uninsured, your current lender cannot insure your mortgage but your mortgage may be insurable if you transfer to a new lender – this is where our opportunity lies!

As an aside, if your mortgage was previously “insured,” and you paid for mortgage insurance, you will also be offered the best rates upon transfer or renewal.

Please call us for your Vancouver mortgage needs. Notwithstanding, we can help anyone with their home financing for a mortgage in the Lower Mainland and all over Canada, for that matter.

Continue Reading:

Read Article

Cannabis Legalization and Your Home

Category: First Time Buyer,Real Estate Agent,

On Wednesday, October 17, Canada will legalize marijuana—becoming the second country in the world to do so. This has a host of implications for countless industries. For Canadian homeowners, it means they will be able to grow up to 4 plants per residence for personal use. But that could have its pitfalls.  That’s because lenders currently HATE if […]

Read Article

July 10th Interest Rate Commentary

Category: Renew Refinance,

July Rate Hike is Likely But Then Pause…? The Bank of Canada will meet on Wednesday (July 11th) to decide on its latest move on interest rates next week and many are expecting an increase from 1.25% to 1.50%. But once July’s hike is done, things become less clear as the economy is showing some mixed signals. *As […]