Mortgage Default insurance is mandatory with less than 20% down payment. You are required to pay for mortgage default insurance if you have less than 20% down payment, this protects the banks if you were to foreclose on the property. In Canada we have 3 insurers CMHC which is a government insurer they are backed 100% by the government, we also have Canada Guarantee and Genworth Canada these are also backed by the government but only up to 90% on the claim they have to pay to the bank on mortgage losses. This allows Canadians a shot at homeownership while mitigating risk with the support of the government. The client needs to pay a premium to the insurers to get this insurance however it is added to the mortgage and the bank pays them upfront for the coverage. There are different premiums depending on the amount you put down. Having this insurance also lowers your interest rate for your mortgage because it mitigates risk at the bank having mortgage default insurance meaning they can offer you a lower rate oppose to someone who has put down 20% on a home and does not have mortgage default insurance.
Mortgage Life and disability insurance is another type of insurance but this is to protect you the client and your family if something was to happen. We offer this protection independent from the bank so if you want to change lenders down the road the protection ports with you to any new lender. Mortgage Life Insurance would pay out the mortgage if you had the coverage and passed away leaving your beneficiary with no debt and a very profitable asset, having a spouse or children this is very important coverage to have. Giving your family financial freedom when they lose a main income holder helps take away some financial stress and allows them to deal with the emotional loss not worrying about any financial hardship. Disability insurance would pay the mortgage payments until you were able to work again, it will cover up to 10,000 a year for 24 months on mortgage payments and property tax payments.
Home Warranty insurance: You can also get home encompass warranty with First National this coverage is free for the first year (the lender pays the premiums) then after you can continue to pay this premium at 17.95 a month. This coverage protects any unforeseen breakdowns in the heating, electrical, plumbing or air conditioning unit. With any insurance there are provisions however this is a great option to allow peace of mind and protect you for unforeseen break downs. You are covered up to 10,000 a year and only have to pay a 50$ consultation fee to access this coverage even if you have to call a technician after hours.
Home Appliance Insurance: You can get home appliance warranty with MCap this coverage is free for the first year as a gift from Mcap to you. After the first year you pay a monthly premium of less than 20$ a month to continue to get this insurance. This coverage covers any unforeseen breakdowns in any appliances within your home so you do not have to worry about expensive costs associated when your washing machine or dishwasher, stove so fourth breaks down.
Call our team at Whalen Mortgages today to get expert advice on your home insurance. 780-715-7533