What’s the difference between Mortgage Insurance and Mortgage Insurance?

Mortgage insurance, does it protect you or does it protect the bank?

It’s a Great question, and it’s one that confuses a lot of people so Today, I want talk briefly about the difference between the two.

I’m basically talking about two types of insurance, and although they are totally different, they do have TWO thing in common

1) YOU pay for both of them.
2) BOTH insure your mortgage

The BIG difference is WHO they protect.

Let me start with High ratio mortgage insurance also referred to as CMHC default insurance.
You get this type of insurance before you actually purchase the home.
It’s required by law on ALL mortgages made in Canada with LESS than 20% down,

This type of insurance protects the BANK, NOT YOU.

It safeguards the bank in case you go into default on your mortgage
Hence the name default insurance!

Now the other type of mortgage insurance you actually get after you purchase your home.
This type of insurance, unlike the first one, actually
It basically pays off your mortgage in the event of an unexpected death.

Let me tell you a quick story about something that happened back east a number of years ago –
Husband & wife bought a home,
6 months later, husband is diagnosed with cancer.
A year later he dies.
Now the Wife thinks they had mortgage insurance and requests mortgage to be paid off.
She was told that she didn’t have insurance.
She sued and it went all the way to the Supreme Court of Canada, fortunately she won.
But Since that court decision, if you do decide NOT to take insurance, you must sign a waiver.
As much as it is optional insurance, I highly recommend it.
As you can see, there’s a lot more to a mortgage than just numbers.

You need the Right Advice at the Right Time!

You might want to call me to discuss 604-273-2002

Mark Fidgett | 604-273-2002

“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret

A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!

T 604.273.2002 | F 604.522.2072

W http://www.notapennydown.com

An independent Mortgage Specialist associated with the Verico Mortgage Network.