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Hi Ratio / Default Insured

A high ratio default insured mortgage is a type of mortgage in which the borrower has a down payment of less than 20% of the purchase price of the property. In this case, the borrower is required to purchase mortgage default insurance, also known as high ratio mortgage insurance. This insurance protects the lender in the event that the borrower defaults on the mortgage.

Mortgage default insurance is typically required for high ratio mortgages in Canada, and is typically provided by the Canada Mortgage and Housing Corporation (CMHC), Genworth Financial Canada, and Canada Guaranty.

The premium for mortgage default insurance is typically a percentage of the mortgage amount and is added to the borrower's mortgage balance. The premium percentage is based on the size of the down payment and the borrower's credit score. Borrowers with higher credit scores may be eligible for lower premium rates.

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