Quick Facts About Down Payments
Let’s be honest, down payments aren’t exactly the sexiest aspect of the real estate industry. But important changes to the minimum payment for homes priced above $500,000 will come into force on February 15th of this year. This being the Vancouver real estate market, these changes will apply to a significant amount of property in our fair city. If you’re in the market for some new digs, here are some quick facts about the new down payment rules:
- Federally regulated lenders must obtain mortgage insurance in instances where the down payment is less than 20 per cent of a property’s purchase price.
- Mortgage insurance premiums range between 0.6 per cent and 3.85 per cent of the value of borrowed money.
- Effective February 15th, 2016 the minimum down payment for new insured mortgages will increase from 5 per cent to 10 per cent for the portion of the house priced above $500,000.
- For properties priced up to $500,000 the 5 per cent minimum down payment will remain the same.
- A minimum down payment of 20 per cent will be required for properties priced above $1,000,000.
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