As of May 1, 2014, the Canada Mortgage and Housing Corporation will be increasing the premiums to be paid on new mortgages.
According to www.cmhc-schl.gc.ca the loan to value ratio on a ``up to and including 95%`` mortgage will go from the current premium amount of 2.75% to a new premium of 3.15%,*
so simply calculated:
- at a 95% ratio a $200,000 mortgage at current premium 2.75% will cost $5,500.00
- the same mortgage amount at the new premium of 3.15% will cost $6,300.00
When blended in over the amortization period of the mortgage, it represents a minimal amount.
As a savvy Buyer it pays to know all the `hidden costs` that have an affect on your buying power. Get informed by contacting Canada Mortgage and Housing Corporation at the email above or sit down with a trusty lender and ask for specific details regarding the cost of borrowing for your new home.
As an up-to-date SELLER, you need to know what affects the buying power of the potential Buyer and how it can inevitably affect you and your Realtor in the successful sale of your property.
If you have any questions regarding what can affect the purchase or sale of your property, call or email me. Remember, It pays to know.
*note: premium rates increase or decrease according to loan to value ratio as set out. The above calculation for is illustrative purposes only. Contact your lender for specific information regarding your personal mortgage details