Good news for Buyers: Mortgage insurance changes

The federal government stated that it is raising the Loan to Value ratio requiring mortgage insurance from the current 75 per cent to 80 per cent. This will help some home buyers who will now be able to forgo scrimping to save for a 25% down payment to avoid fees for mortgage insurance. To give an example, for a borrower with a $200,000 mortgage, this change would save them the 1% mortgage insurance premium, or $2,000, based on having an 80% LTV mortgage. In addition, this harmonizes our regulations with those in the US, where the cut off point for mortgage insurance has been 80% LTV for years.