Get ready for some exciting changes to mortgage default insurance rules, effective December 15th, 2024! These updates are designed to make homeownership more accessible for a wider range of buyers.
Higher Price Cap for Insured Mortgages
The maximum price for homes eligible for insured mortgages is increasing from 1 million to 1.5 million. This means more buyers can access mortgages with default insurance, even for higher-priced properties.
Here’s the breakdown:
- Who it applies to: Buyers requiring high-ratio mortgage default insurance (down payment less than 20%, loan-to-value greater than 80%).
- Requirements: The property value must be under $1.5 million.
- Down payment requirements:
- 5% on the portion of the purchase price up to $500,000.
- 10% on the portion of the purchase price between $500,000 and $1.5 million.
Longer Amortization for First-Time Buyers and New Builds
Now, all first-time homebuyers and buyers of newly constructed homes can qualify for 30-year mortgage amortizations, even with high-ratio mortgage insurance.
Here’s who qualifies:
- First-time homebuyers:
- Never purchased a home before.
- Haven’t owned a home as their primary residence in the past 4 years.
- Recently experienced a marriage or common-law partnership breakdown.
- Buyers of new builds: Purchasing a newly constructed home.
These changes are great news for anyone dreaming of homeownership!
With a higher price cap and longer amortization options, more people can achieve their dream of owning a home.
Stay tuned for more updates as we get closer to the December 15th implementation date!