Canada Guaranty Mortgage Insurance Benefits

Archive for 2016

[UPDATED] Low-Ratio Mortgage Insurance Requirements

LENDER UPDATE: High- and Low-Ratio Mortgage Insurance Requirements

On October 3, 2016, the Minister of Finance announced new measures designed to support the strength of Canada’s housing market through responsible lending practices and guidelines focused on promoting sustainable homeownership for borrowers. Canada Guaranty is committed to upholding prudent underwriting practices and, in compliance with these rules, will be implementing these new high- and low-ratio mortgage insurance eligibility requirements.

Please take a moment to review the following updates:

We’re Pleased to Introduce …

Brad Checknita
Director of Sales, Western Canada
Canada Guaranty Mortgage Insurance Company

Brad.Checknita@canadaguaranty.ca
778.389.4072
1.866.414.9109 ext. 7125


Committed to Supporting our Partners in Western Canada

We’re pleased to welcome Brad Checknita, Canada Guaranty’s new Director of Sales supporting Western Canada. Brad brings a wealth of diverse industry, sales and leadership experience, as well as a commitment to providing dedicated service and support to our valued partners and regional Account Executives in British Columbia, Alberta, Saskatchewan and Manitoba.

Brad first entered the Mortgage Industry in 2006 with Accredited Home Lenders, where he supported Brokers from across the country in his role as Senior Account Executive. Looking to further his experience, Brad joined Macquarie Financial in 2008 where he was quickly promoted to a Senior Business Development position. In 2012, he continued to build on his knowledge and strong industry relationships as an Account Manager with First National Financial LP, where he remained until joining the Canada Guaranty team in June 2016. Brad graduated with a Bachelor of Commerce degree from the University of Alberta and is currently pursuing his CFA designation.

Working with the Western Sales team, Brad looks forward to bringing his nearly 10 years of lender experience and a passion for developing lasting client relationships to his new role at Canada Guaranty.

Products + Solutions


Purchase Advantage PlusTM
A Dream Home is Sometimes Only a Renovation Away!

Sometimes, finding your dream home means love at first sight. For others willing to put in a little effort, it means love with foresight. For the patient homebuyer, a more affordable home can quickly be transformed into a dream home through careful planning, thoughtful renovations and the right program to help finance the projects.

The Purchase Advantage Plus™ program is designed to assist borrowers who are purchasing a home and would like to make value-added improvements, all while including these costs within their first mortgage. With as little as five per cent down, the program offers Canada Guaranty-insured borrowers immediate access to additional funds to finance their approved, value-added home improvements.

ELIGIBLE HOME IMPROVEMENT EXAMPLES


Some of the most common renovations homebuyers implement to improve the condition, enjoyment or value of their home, include:

  • Kitchen: A complete renovation or updates made to enhance the quality of the finishes and materials (i.e., flooring, counter tops, cabinetry, etc.).
  • Bathroom: A complete renovation or the addition of another bathroom in the home.
  • Painting – Interior and/or Exterior of Home: A new coat of paint in a universally appealing colour palette goes a long way to refreshing and updating the look of a home.
  • Replacing the Roof: Installing a new roof not only adds curb appeal through more attractive and durable shingles, it also ensures potential issues are eliminated, such as unnecessary heat loss or leakage.

INELIGIBLE HOME IMPROVEMENT EXAMPLES


Improvements not eligible under the Purchase Advantage Plus program, include:

  • Appliances
  • Decorative items (i.e., light fixtures, furniture, window coverings, etc.)
  • Hot tubs
  • Above ground pools
  • Outbuildings (i.e., secondary garage, workshop, shed, etc.)

Unsure whether an upgrade qualifies under this product? Contact your regional Account Executive or speak directly with an Underwriter at 1.877.244.8422 to discuss the eligibility of a proposed renovation.

THE PROCESS | PURCHASE ADVANTAGE PLUS


Below is a brief overview of how the program works, from application to approval:

  1. The homebuyer makes an offer on a property.
  2. A quote is established for the renovation work to be done.

    The quote should list following information:

    • Name, address and contact information of contractor
    • Details of the work to be done and materials being used
    • Total cost and terms of payment
    • Work schedule including start and completion date
  3. The borrower provides the quote(s) to the lender, which are then submitted together with the application to Canada Guaranty for review.
  4. If the improvements are over $40,000 or total over 20% of the purchase price, a full appraisal will be ordered.
  5. Assuming the value is substantiated and all underwriting requirements are met, the deal is approved, conditions are met and the file is funded.
  6. The Lender holds back the approved amount of improvements. When the renovations are complete, the borrower provides confirmation to the lender.
  7. Once confirmed, the renovation holdback is released by the lender to the borrower (to repay the contractor for the completed renovations).

PROGRAM REQUIREMENTS | PURCHASE ADVANTAGE PLUS


To review all requirements and qualifying guidelines, please visit the Canada Guaranty website to download the Purchase Advantage Plus product sheet. Should you have any questions or wish to discuss your client’s unique circumstances, please do not hesitate to contact your dedicated Account Executive or speak directly with a member of our National Underwriting Team at: 1.877.244.8422

NOTE: The Lender’s internal guidelines always take precedence and must be adhered to prior to review by Canada Guaranty.

Housing Market Trends




To view additional monthly aggregate house price data for 13 of Canada’s major cities, please visit the Brookfield RPS House Price Index site.

Source: CREA (The Canadian Real Estate Association)

HOUSING MARKET HIGHLIGHTS

  • Canada’s housing market continues to set new records across house prices and sales, primarily due to the hot British Columbia and Ontario markets. Home prices in Vancouver and Toronto continue to rise at an accelerated rate.
  • Large regional variations continue to persist, with Toronto and Vancouver moving upward, the Prairies seeing slight price decreases, and stable prices continuing in Quebec and Atlantic Canada.
  • Overall, prices are up 7-9% annually, driven completely by urban markets in southern Ontario & British Columbia.
  • In Calgary, Edmonton, Regina and Saskatoon, home prices remain flat to down 4% annually, and in Ottawa, Quebec and the Atlantic regions, where similar trends are seen, home prices remain relatively unchanged.


NOTE:
Traditionally, a buyer’s, balanced or seller’s market is defined by the following ranges of sales-to-listings percentages:

< 35% Buyer’s Market (More homes are for sale than there are buyers)
= 36-54% Balanced Market
> 55% Seller’s Market (More buyers available than there are homes for sale)

NOTE: Click on the image of the map to download/print in PDF format.

Introduction from Andy Charles


Andy Charles

Rebuilding Communities
The change of seasons often prompts reflection on the events of the past quarter and consideration for what is to come. Following an active spring, I reflect that while two housing markets in Canada were experiencing the effects of a surging housing market,  others are facing challenges including a slowing marketplace and, for some Canadians, the difficult task of rebuilding their homes, their communities and their lives. This May, the perseverance of 80,000 Fort McMurray, Alberta residents was tested as wildfires devastated neighbourhoods and displaced families. The independent and proud spirit of that province was on display as many Albertans (including a Canada Guaranty team member) came together to open their doors to shelter evacuated families in need.

We’re privileged to work in an industry that creates opportunities for Canadians to realize their dream of homeownership. We also have an obligation to support home buyers with dreams that have been threatened by unexpected circumstances. Canada Guaranty is committed to working closely with our lender partners to find solutions that help mitigate unforeseen financial hardship, as a result of home or job loss. Throughout the process, our Loss Management Team is available to provide ongoing support to our partners, while offering guidance on implementing appropriate workouts through our Homeownership Solutions Program.

Raising Down Payments
I recently had the pleasure of speaking with Canadian Mortgage Trends and the National Post, where I was asked to provide my perspective on the impact of raising the minimum down payment on insured mortgages. While I respect the opinions expressed in our industry, this measure would have very little material impact on the trajectory of rising house prices in the GTA and GVA. The first-time home buyer segment represents just 30% of the housing market and has a $1-million maximum. These buyers are not purchasing the multi-million dollar properties in the greater Toronto and Vancouver areas.  As I expressed in the article, increasing the down payment requirements would only hurt new home buyers in Canada’s smaller urban housing markets, where a negative economic impact would be readily felt and do little to address the GVA/GTA market dynamics. I have no doubt that discussions on moderating these overheated housing markets will continue through the summer months.


We appreciate your continued business and look forward to providing you with our dedicated support throughout another busy season.

Andy Charles
President and CEO
Canada Guaranty Mortgage Insurance Company

LENDER UPDATE: Homeowners Affected by Wildfires in Fort McMurray, Alberta

LENDER UPDATE
Homeowners Affected by Wildfires in Fort McMurray, Alberta
(Download Update)


On behalf of Canada Guaranty, I would like to extend our deepest concern for the residents of Fort McMurray and the many families who have been affected by this incredible loss.

To support those impacted by these unforeseen challenges, Canada Guaranty is committed to working with our partners to find appropriate solutions to mitigate temporary financial hardship, resulting from the loss of a home and/or employment in Fort McMurray.

  • Through our Homeownership Solutions Program, lenders currently have the ability to capitalize up to 4 monthly mortgage payments. To assist homeowners as they navigate through this difficult situation, Canada Guaranty is prepared to extend this option to allow the capitalization of up to six (6) monthly payments, provided the original insured loan amount is not exceeded.
  • In the event that a homeowner requires additional assistance, or exceeds the original loan amount, Canada Guaranty will review each request on an individual basis.

Our Loss Management Team is available to provide ongoing support and consultation to facilitate the implementation of a suitable workout. Should you have any questions or wish to discuss your client’s unique circumstances, please do not hesitate to contact a member of our team:

CANADA GUARANTY | LOSS MANAGEMENT TEAM
  • Toll Free: 1.866.414.9109 ext. 7001
  • E-mail: lossmanagement@canadaguaranty.ca





Mary Putnam AMP
Vice President, Sales and Marketing
Canada Guaranty Mortgage Insurance Company

Telephone 416.640.8936 
Toll Free 866.414.9109 ext. 8936 
E-mail mary.putnam@canadaguaranty.ca

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