Should clients use mortgage insurance calculators?

To help future homeowners, the Canadian Mortgage and Housing Corporation (CMHC) offers a variety of tools and calculators, including a mortgage loan insurance premium calculator.

Read: Canadians expect to pay $60K in mortgage insurance

But these types of calculators don’t always provide accurate information, explains MoneySense columnist Bruce Sellery. “A down payment of at least 20% of the purchase price should eliminate the need for mortgage loan insurance. [But] I tried both the CMHC and Genworth calculators with [a dramatic] example—a down payment that covered 80% of the purchase price—and it still showed that I would have to pay insurance of $300.”

Find out more about how the calculators work.

For more on mortgages and housing, read:

World’s most expensive real estate

Almost half of homeowners make extra mortgage payments

Home price increases subdued

Longer-term mortgages gaining popularity

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.