Qualified home buyers will benefit from the premium reduction provided they are purchasing a home with less than 10 per cent of the purchase price down, and have a CMHC insured mortgage. There will be a six month transition period to allow mortgage and other financial institutions time to update their systems and incorporate these cost savings. In the meantime, CMHC will provide the refund equivalent to the premium reduction directly to eligible borrowers.
A refund cheque will be issued within about six weeks after the mortgage closing date. After the transition period, the reduction in premium will be applied when buyers obtain their mortgage insurance, eliminating the need to apply for it, and the lengthy wait for the refund to come in the mail, at a time when every last dollar is important.
In addition to the premium reduction, which took effect in April, CMHC is also planning to include title-related risk protection in its mortgage insurance products at no additional cost this fall. So not only will buyers save money on premiums, they’ll also have the added peace of mind that title insurance offers, which should also reduce the closing fees.
Other recently added CMHC incentives to its mortgage insurance to help homebuyers meet the changing needs of Ontario and other Canadian residents wanting to purchase a home include:
