Get the best mortgage insurance rate: our advice!

About 90% of Quebecers have taken out mortgage insurance with a mortgage rate that is far too high. Why ? Quite simply because many borrowers do not know that they have every right to take out their mortgage insurance elsewhere than with their lending organizations, or that they too hastily sign the overpriced offer that the latter are offering them. .

Take the time to shop

The first mistake to avoid when buying a property is to accept the mortgage insurance offer offered by the banker without putting it in competition. Indeed, financial institutions manage to present mortgage insurance proposals at the same time as the mortgage agreement. So most of the time, borrowers think they should purchase mortgage insurance from the same organization as where they got their loan. This is totally wrong! So always take the time to shop around, as there is no requirement for a buyer to take out both the mortgage and the insurance with the lender. Combining loan and mortgage insurance can also bind a borrower who wants to change banks when renewing their mortgage or buy another asset, as mortgage insurance contracts with banks are not transferable. For example, an owner with two contracts in the same establishment, and whose state of health has deteriorated, will not be able to submit a new insurance request and therefore will be unable to change bank to benefit from '' a better rate offered elsewhere when renewing their mortgage. Not to mention that most insurance policies offered by banks do not determine eligibility for a benefit until the time of claim.

Don't wait for the mortgage to renew

Since the law allows the borrower to change insurance at any time, why wait for the renewal of the mortgage to put his insurance contract in competition and change if the rates are more attractive elsewhere than with his insurer? All you need to do is find out about the rates charged in other establishments and come back to your banker to ask him to revise his rate downwards. Because very often, a simple phone call to his bank can lower the rate and earn several thousand dollars.

However, if the banker refuses to match the other offers, there is no hesitation. Since it is against the law to apply penalties for changing mortgage insurance, you might as well change insurer as quickly as possible. When you realize that the savings generated on an average mortgage can run up to $ 25,000, you don't have to think twice.

Optimize your down payment and credit score

The amount of the down payment has a significant impact on the rate offered by the insurer. Also, increasing the down payment and in particular bringing at least 20% of the price of the property can lower the mortgage insurance rate. This scenario is particularly favorable if real estate prices are high, and prices are expected to drop, or even if they are lucky enough to pay reasonable rent.

As for the credit rating, if it generally allows between 660 and 700 to obtain a mortgage, on the condition also of remaining in acceptable debt ratios, it must reach 760 and more to help bring down the mortgage rate. mortgage insurance because people with great credit scores get the best interest rates and terms.

Even without having a large down payment or having a very high credit score, it is possible to benefit from a good mortgage insurance rate. Just don't accept the bank's proposal as it is, shop around and don't hesitate to change insurer if necessary, since the law allows the borrower to change insurance at any time.