For many people, the hardest part of buying a home is saving enough money for a down payment. The bigger the down payment, the smaller the amount of your mortgage loan. If you’ve arrived in Canada within the last 36 months or less, you may qualify for Genworth’s New To CanadaTM product, which allows you to buy with as little as 5 per cent downpayment.
A down payment of 20% or more of the property will qualify you for what is often called a conventional mortgage. If it is less than 20 % (which means you’ll have a high ratio mortgage) you will be required to purchase mortgage default insurance. It’s a system of financial protection that allows buyers with low down payments access to the same low mortgage rates as buyers with larger down payments. This is because the lending risk is removed from the financial institution and taken on by the mortgage insurer.
Genworth Financial Canada is the largest private sector supplier of mortgage default insurance in Canada. Mortgage default insurance is also available from several other providers in Canada. Your lender will both inform you about, and arrange for, mortgage default insurance. You may also be asked about your need for “mortgage life insurance,” which is a separate life insurance product.