What is Mortgage Insurance? Review of Mortgage insurance vs Life Insurance

[HeyAddy]

There are two different topics we are discussing. The mortgage insurance here is in case you're not able to pay your mortgage due to illness or death. The 20% mortgage refers to CMHC premiums that are added based on your downpayment amount...

CMHC premium is an insurance that protects the lender in case you aren't able to make payments based on your credit history.

Mortgage insurance is in case you can't make payments due to sickness or death.

Hope this clears it up... :)

[HeyAddy]

You need to have insurance but the video is to inform you that you have options when you're being sold mortgage insurance from the bank.

I posted a link on my blog for an expose done by CBC that talks a bit more in detail about the topic... Check the direct link posted above...

[s2macdon]

@HeyAddy Yes, they made us get insurance. I think you don't need mortgage insurance if you put down 20%, right?

I just took the mortgage insurance that was set up for us. Being a first-time home buyer was very overwhelming and we didn't really know too many options at the time. Still learning...always learning actually.

[tanbrolo]

@s2macdon "I think you don't need mortgage insurance if you put down 20%, right?"

That would be CMHC coverage, which is unrelated to mortgage insurance. Mortgage insurance pays of the house if you die. CMHC protects lenders against mortgage default.

[s2macdon]

P.P.S. Thanks for posting this.

Oh - and also a question - do you have to purchase insurance at the time of your mortgage contract? Or any time throughout your term? You might have covered this,but I may have missed it due to my inattention to detail.

[s2macdon]

First, I'm not going to die. B). If I do die, I won't have to pay mortgage anyway. #3. Too many big words. Lastly, I really like the slogans, "If you own it, you control it", and "The controlling party is the bank", and also "If everything is a no, you qualify".

P.S. Your phone scared me.