Paul, what if we refinanced in 2015 and lost our CMHC insurance as a result because the property value appreciated where LTV was now below 80%? I'm not sure if we lost the CMHC insurance as a result of refinancing at another lender and not sure how I can find out.PaulMeredith wrote: ↑Dec 28th, 2018 9:13 am
An insurable mortgage must meet the following criteria:
- Value of home must be under $1 million (applies only if home was purchased after November 30th, 2016).
- Maximum 25 year amortization
- Purchases or switches only (no refinances)
- Owner occupied property
The last three points are fairly straightforward, but let me touch on the first one for a moment as there are some exceptions. Let's say you purchased your home for $850,000 in 2014 for example, and it is now worth $1,100,000. When that mortgage comes up for renewal, this could be processed as an insurable loan, meaning you can get lowest rates. This is because you had purchased the home prior to November 30th, 2016, which is the date these new mortgage regulations took effect. However, if you had refinanced he home after November 30th, 2016, then this mortgage would no longer be insurable. Therefore, the higher uninsurable rates would apply.
Any uninsurable mortgage would be any of the following:
- Any mortgage on a purchase / property value over $1 million
- 30 year year amortization
- Refinances and rental properties
Hope this helps bring some clarity as to how mortgage rates are quoted. I know this can get pretty confusing, but that's what we are here for
In any case, does this mean if we want to switch lenders, we can opt for an insurable loan/mortgage to get a lower mortgage rate? It may make sense if the CMHC surcharge is very minimal based on the LTV as at renewal?