Four Types of Insurance… For Just One House!

As a homebuyer it’s wise to prepare yourself for the sometimes-confusing topic of insurance. Here’s the straight talk.

 There are four primary types of insurance when you buy a home.

1. Mortgage Default Insurance
2. Title Insurance
3. Mortgage Life Insurance
4. Home Owner’s Insurance 

Mortgage Default Insurance:  When you buy a home with less than 20% down you must have insurance through either CMHC or GEnworth.  This assures the Lender that you will pay as agreed.  If you are not able to pay, Lender will be reimbursed by the insurer.  There is no direct benefit to you to have this type of insurance, it is only a benefit to your Lender. The total amount of the Insurance is added to the mortgage amount. It is not an upfront cost when buying a home. 

Title Insurance: Title Insurance will be offered to you at the Lawyers office at the time of closing.  The fee is relatively small (Usually under $500.00) and is payable as part of the closing cost. This type of Insurance assures clear title to your property during your ownership and can offer a level of protection in the event that someone tries to take your property by committing fraud to obtain it. 

Mortgage Life Insurance: This type of insurance will pay out the total outstanding Mortgage on your property in the event that the insured dies. Lenders now offer Critical Illness and Disability Insurance in the same application.  The fees will be based on Mortgage amount, your age and state of health. Payments are usually charged monthly. 

Homeowner’s Insurance:  Lender require it before your Lawyer can complete your purchase.  This type of insurance will cover you in case of Fire or other damage to the house during your occupancy.  It will be paid annually or monthly.

With over 50 Lenders and hundreds of low rate mortgage options, shouldn’t you talk to an Agent at “Your Durham Mortgage Solutions Team” and Mortgage Intelligence Today?

Elfie Hayes as seen on the CTV National News, Rogers TV, published in RENO & Décor Magazine and profiled in Canadian Mortgage Professional Magazine.