Mortgage Insurance or an Insured Mortgage

There is a difference: 

Mortgage insurance is a life insurance policy that pays out as a result of a death of the insured.  A policy taken out with the bank makes the bank the beneficary.  A policy taken out with an independant insurance agent, you decide who the benefitary is and who gets paid the benefit of the insurance.

IT IS ABOUT OWNERSHIP:  WHO OWNS THE BENEFITS OF THE POLICY?  IT SHOULD BE "YOU"!  

An insured mortgage: also know as mortgage loan insurance is when the bank takes out a policy with CMHC or GE to insure their interest in a high ration mortgage (greater then 75% loan to value).  CMHC/GE will charge you an insurance premium on the amount of the mortgage based on a formula they have.  The bank's mortgage funds are then covered in case the mortgage is in default and foreclosure action is taken, this makes the bank the benefitary of this program. 

QUOTE FROM CMHC'S WEBSITE: "CMHC’s Mortgage Loan Insurance is an insurance that covers your lender’s risks associated with financial loss that can occur when a homeowner defaults on their mortgage loan and in turn increases your access to mortgage financing and at the most competitive interest rates possible."

For more information on this or to obtain a mortgage insurance policy that you own and control, give Marge Lessoway a call.  Marge is a licensed insurance agent in addition to a licensed real estate agent.