High-Ratio Mortgage
A mortgage is considered a high-ratio mortgage when your down-payment is less than 20% of the home value/purchase price. If you have a high-ratio mortgage, you need Mortgage Default Insurance. This is a hard and fast rule because financial regulations do not permit regulated lenders to have high-ratio mortgages on their balance sheets unless they are insured. If you Default on the mortgage, the insurance will pay the lender for certain covered losses.
About The Author
Don Scott
Don Scott is the founder of a challenger mortgage brokerage that is focused on improving access to mortgages. We can eliminate traditional biases and market restrictions through the use of technology to deliver a mortgage experience focused on the customer. Frankly, getting a mortgage doesn't have to be stressful.
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