Applications are accepted from the borrower . To obtain CMHC Mortgage Loan Insurance, lenders pay an insurance premium. They do eat-up the initial equity, but it gets rebuilt as soon as you start making payments. There are some cases where putting down 5% makes sense, but with this increased fee, it’s important to really think about what would happen if housing prices went down after you bought – and you only have 1% equity in your house. Thank you thank you – I feel like I’ve been trying to wrap my brain around ‘closing costs’ for quite some time now with very little luck – why/how they vary, and how they impact the amount of money you need to have on hand at the time of your actual house purchase. When I spoke with Jared Ksenica, Regional Vice President of Specialized Sales for the Greater Toronto Division at BMO, he mentioned that the first thing anyone should understand going into the process is what CMHC even is – and how it’ll impact the amount they need to save. within 2 years of the closing date of the mortgage. Eligible borrowers can receive a 15% or 25% refund of the CMHC premium paid. It is best to put 20% down, but not always possible, particularly if you live in Toronto or Vancouver. This is a significant cost that needs to be paid by the buyer, and not usually paid out of the mortgage proceeds unless arranged. As someone probably 3-5 years away from buying a home (I know, I like to plan!) This worksheet will help you do just that. The home is located in Canada. What are the General Requirements to Qualify for Homeowner Mortgage Loan Insurance? For more homebuying tips, visit CMHC's interactive Step by Step Guide at www.cmhc.ca. CLOSING COSTS DESCRIPTION Property/Fire Insurance $400 - $800 for average Winnipeg Home All mortgage lenders require a certificate of fire insurance to be in place from the time you take possession of your home. In addition to closing costs, there are other expenses and/or events that may require a cash outlay before, on or after your house closes. “There may be a cost or fee associated with setting up an account with a service company such as Hydro and Gas (for connections, etc.) And next week, I’ll be chatting with Jared and the BMO team one more time, to get clear on how we should all be budgeting for our post-new-house life (and the line items to add to your budget when you’re planning!). It is a good idea to gather estimates of these fees and expenses so that you are fully prepared. I asked Jared for some real talk: What are people usually surprised by when they close on their first house, beyond just their down payment and CMHC? If you’re buying a house that’s $499,999, you still only need to put down 5%, but I’d add that maybe you should seriously consider whether you can afford a half million dollar home with only 5% down. These closing costs can include fees for home inspectors in Ontario and real estate lawyers in Ontario. Home insurance typically costs around $1200 per There are several other requirements in order to be approved for CMHC coverage. What are the General Requirements to Qualify for Homeowner Mortgage Loan Insurance? When buying a multi-family building as an investment property, closing costs can add up to a large amount, and thus should be calculated with careful attention since the investor needs to estimate if he has enough funds for the down payment and the closing costs prior to closing the deal. 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