New Home - CMHC Issues - Calgarypuck Forums - The Unofficial Calgary Flames Fan Community

mykalberta · 05-09-2006, 11:47 AM

Some of you may remember a thread a month or so a go on my quest for a condo.

Well I found one end of April for Possesion June 01, today I get a call from my banker saying that CMHC wont insure my motrgage because they dont believe any condo in Calgary is worth $250k. My bank is trying to find an alternative but its not looking good.

I had two conditions on the contract for sale, 1 was document inspection and the other was financing. If CMHC wont insure it and another insurance company cant be found it looks like my search will come to an end.

To anyone with experience in this matter, what can be done, anything, will I have to null the agreement and lose the 10K deposit. Any help would be greatly appreciated.

Thanks

MYK

ken0042 · 05-09-2006, 12:07 PM

I would think that if you had financing as a condition, then not being able to get financing would be a means out; unless you've already waived that condition.

Mike Oxlong · 05-09-2006, 12:40 PM

Use a mortgage broker!!
Those guys have connections at the banks to get you the best rates as well as connections at CMHC to get things passed through.

I don't see how CMHC cannot think any Condo in Calgary is worth more than $250k. I just refinanced one for $285 and there are tons selling for WAY more than $250k. Something is fishy.

I strongly suggest calling a mortgage broker rather than using your bank. They will also help you with GE Capital if CMHC just won't insure it.

www.nikkibroker.com
I use this girl and she is very knowledgeable. She mainly deals with investments but she can likely help you out. Plus she is fairly hot (if that matters)

I would be very surprised if she couldn't make this happen for you provded the COndo isn't WAY overpriced and you have decent credit. Call her or some other mortgage broker.

I-Hate-Hulse · 05-09-2006, 12:50 PM

I had a situation similar to this as described in your other thread on 1st time buyers:

http://forum.calgarypuck.com/showthr...ighlight=buyer

Ironically, my situation just resolved itself today. When I first bought my place, it was 5% over what the appraiser deemed safe for the bank to mortgage based on comparable sales in the area. As such, they would only grant me the value of the appraisal, and I would have to fund the difference between appraisal and purchase price by myself.

I ended up grinding down the seller which is what I would recommend 1st. Doing this put me in a position that I could fund the difference so I went ahead with the purchase. The appraiser was quite good, and let his appraisal period stretch right to the deadline before posession date, and in that time the market came up enough of the 5% that I was able to get my full purchase price as a mortgage, 3 weeks later. You could also try this.

Keep in mind that was when I put 25% down - in that case the bank does the appraisal. for anything less than 25% down, CMHC does the appraisal.

I suspect the comment was that there were not condos in the immediate AREA that exceeded $250K - there are certainly some that exceed that.

Your next bet after CMHC is to try GE or Genworth - I've know people that had problems with CMHC get a GE mortage easy enough so it doesn't mean your dream is dead.

Good luck!

mykalberta · 05-09-2006, 01:01 PM

Thanks for the quick replies BTW, I knew there is a reason that this and RFD are the only forums I visit on a daily (except weekends) basis

I just talked to my broker, and GE is sending an appraiser to look at the property today.

I also contact my Real Estate anget to see what she could do and called the local CMHC office in Calgary (didnt know they had one) and she said she would also call the broker.

I should know by today whether or not its a go since today is the financing condition deadline.

Here's hoping.

MYK

Reaper · 05-09-2006, 01:07 PM

Quote:

Originally Posted by fotze

I think there is a competitor to CMHC, GE Capital Mortgage Insurance Company (GEMICO). Try them and see.

That is who my wife and I are using for mortgage insurance. The bonus is that there are some benefits to being insured by GE i.e. discounts on GE products, extended warranties on GE appliances, and other deals of the like.

Bend it like Bourgeois · 05-09-2006, 01:27 PM

I think CMHC might have a policy cap of not insuring more than 250k.

I remember something like that.

guzzy · 05-09-2006, 01:50 PM

Quote:

Originally Posted by mykalberta

Some of you may remember a thread a month or so a go on my quest for a condo.

Well I found one end of April for Possesion June 01, today I get a call from my banker saying that CMHC wont insure my motrgage because they dont believe any condo in Calgary is worth $250k. My bank is trying to find an alternative but its not looking good.

I had two conditions on the contract for sale, 1 was document inspection and the other was financing. If CMHC wont insure it and another insurance company cant be found it looks like my search will come to an end.

To anyone with experience in this matter, what can be done, anything, will I have to null the agreement and lose the 10K deposit. Any help would be greatly appreciated.

Thanks

MYK

CHMC is part of the financing. If they won't insure your mortgage than the bank won't loan you the money, hence you can back out on financing. I know people that have had the same problem only they didn't have any conditions and they lost their downpayment.

troutman · 05-09-2006, 01:51 PM

Quote:

Originally Posted by mykalberta

Thanks for the quick replies BTW, I knew there is a reason that this and RFD are the only forums I visit on a daily (except weekends) basis

I just talked to my broker, and GE is sending an appraiser to look at the property today.

I also contact my Real Estate anget to see what she could do and called the local CMHC office in Calgary (didnt know they had one) and she said she would also call the broker.

I should know by today whether or not its a go since today is the financing condition deadline.

Here's hoping.

MYK

Good luck. I was going to suggest you get a formal appraisal. I'm sure many condos in Calgary are now worth more than $250K.

Another alternative for mortgage insurance is Genworth Financial:

http://www.genworth.ca/mi/eng/index.html

ken0042 · 05-09-2006, 01:55 PM

Quote:

Originally Posted by troutman

I'm sure many condos in Calgary are now worth more than $250K.

I just looked and there are 93 condos going for more than $250K on MLS; including 5 that are over $1M.

Reaper · 05-09-2006, 02:00 PM

Quote:

Originally Posted by troutman

Good luck. I was going to suggest you get a formal appraisal. I'm sure many condos in Calgary are now worth more than $250K.

Another alternative for mortgage insurance is Genworth Financial:

http://www.genworth.ca/mi/eng/index.html

Isn't Genworth Financial just GE with a new name?

Mike Oxlong · 05-09-2006, 02:02 PM

Quote:

Originally Posted by fotze

Was she the one who posted here for a while and got mad cause I implied she was hot.

LOL I have no idea. I kind of doubt it was her. I really can't see her having a problem with guys thinking she is hot. She makes damn sure she looks hot all the time (and it works) so I can't see her being upset if someone commented on her hotness.

I will ask her next time I see her.

REALLY good mortgage broker though. Knows her **** inside and out.

Eagle Eye · 05-09-2006, 02:38 PM

Quote:

Originally Posted by Mike Oxlong

REALLY good mortgage broker though. Knows her **** inside and out.

plus I heard that she is HOT..LOL

I-Hate-Hulse · 05-09-2006, 02:38 PM

Quote:

Originally Posted by mykalberta

I should know by today whether or not its a go since today is the financing condition deadline.

Most reasonable people would let the buyer have a few extra days for financing - it's easier to do rather than go through the process of relisting and what not.

Call this lesson #2 here on CP why you should never waive financing on a new place....

troutman · 05-09-2006, 02:39 PM

Quote:

Originally Posted by Reaper

Isn't Genworth Financial just GE with a new name?

We're Genworth Financial Canada, formerly GE Mortgage Insurance Canada, the country's only private sector supplier of mortgage default insurance. Together with our related affiliates, we are the largest private sector mortgage default insurance company in the world.

http://www.genworth.ca/mi/eng/misc_pages/about_us.html

Sample00 · 05-09-2006, 03:52 PM

if CMHC wont insure, which also doesnt make a lot of sense, then your financing committment is not completed. you should get your deposit back.

guidelines between CMHC and GE are very smiliar..but remember, CMHC uses a system called Emili, which electronically appraises your house through the postal code. if it happens to fall outside the parameter then maybe thats what happened in this case, it throws it out of the system and declines it.

Brokers have to deal with CMHC and GE just like all the banks do. you are going through the correct process in filing a grievance.

Hope it works out for ya.

PS the limits that CMHC once had are now gone. they dont limit the value of the house anymore.

mykalberta · 05-09-2006, 04:05 PM

Well, GE sent an adjustor out and he/she appraised it and I am going with them for insurance.

I have to say, I am supremely impressed with GE's quickness on the matter, I was ready to call it quits and say enough is enough with the real estate market in Calgary.

No all that needs to be apporved is the doc inspection on Thursday and all is done.

Thanks for the quick replies.

MYK

Log · 05-09-2006, 04:19 PM

Quote:

Originally Posted by mykalberta

Well, GE sent an adjustor out and he/she appraised it and I am going with them for insurance.

I have to say, I am supremely impressed with GE's quickness on the matter, I was ready to call it quits and say enough is enough with the real estate market in Calgary.

No all that needs to be apporved is the doc inspection on Thursday and all is done.

Thanks for the quick replies.

MYK

Great to hear!!!

Sample00 · 05-09-2006, 04:42 PM

yup..good for you!..congrats!

I-Hate-Hulse · 05-09-2006, 04:46 PM

Good to hear! Congrats! What area did you end up in?

I had a chat with my broker just now and he's seen many CMHC applications halted this week on valuation issues. He made the comment that the real estate agents need to jump in right away with comparable sales data for the neighborhood, and quite often CMHC will grant approval within the hour if that data supports it. CMHC and the approvers are finally putting their foot down and rejecting a lot more deals lately, so you were not alone.

He also made comment as to a huge number of lots being released to Genstar and Carma in June - any truth to this?