There are a lot of aspects which Winnipeg residents consider to be very confusing about mortgage insurance. This has made them not interested in signing with companies like CMHC, Genworth and Canada Guaranty mortgage insurance.
If you are one of these people, there is no doubt that this is the right place to learn about mortgage insurance companies. It will reveal some of their benefits and how they can help you.
What is mortgage insurance?
Before discovering some of the benefits that these companies offer, it is better to understand what mortgage insurance entails. Such knowledge will help you know how to maximize the benefits that these companies offer.
Mortgage insurance is an insurance policy whereby lenders or investors are compensated for losses which may be experienced as a result of default in the payment of a mortgage loan. It can also be referred to as home loan insurance or mortgage guarantee insurance. Below are some of the benefits that it can offer.
Improved interest rates
Mortgage insurance companies like Genworth and Canada Guaranty help to ensure that lenders are protected from any form of loss which is likely to occur due to default when a loan is being paid back. When this happens, lending companies feel secured offering home buyers interest rates that are much better. In a nutshell, the presence of mortgage insurance ensures that interest rates are competitive.
Your own choice of beneficiaries
This is another vital benefit that mortgage insurance companies are offering at the moment. For instance, once mortgage insurance is bought from the banks, the contracts are owned by such banks. They are also the beneficiaries. However, this isn’t the case with mortgage insurance companies as you will be given the freedom of naming any beneficiary of your choice. These loans can be repaid by your chosen beneficiary.
Mortgage insurance companies offer fixed and guaranteed premiums. When mortgage insurance coverage is bought from an insurance company, the amount is going to be the same for the duration of such loan.
Mortgage insurance can be converted
Insurance companies in Winnipeg are very flexible and can allow you get mortgage insurance coverage converted to life insurance on permanent basis all through the duration of such loan. One of the benefits of this is that your premium isn’t going to increase over the course of time which means you could be saving money.
Buyers can purchase using smaller down payments
The market is open to every potential buyer and this couldn’t have been possible without helping to make provisions through which small down payments are made. It means that buyers are given the chance of exploring the features of mortgage insurance through a platform such as CMHC. This allows them to pay less than 20% down payment on the property. Through this, you will be able to become part of the market even with limited resources or budget.
CMHC is the main mortgage insurance company in not only Winnipeg, but all over Canada. Genworth and Canada Guaranty are options, but more often than not, the average Canadian goes through CMHC when possible.