Just when you thought buying a home wasn't expensive enough...the good old Provincial Government goes ahead and makes it even more expensive by seasoning it with a PST tax!
...congratulations Saskatchewan - as of August 1, 2017 - you have the luxury of paying PST on your Mortage Insurance Premiums!
ARE YOU AS EXCITED AS WE ARE?!
...okay, it's about as exciting as slamming your fingers in the door, but it is what it is and we have to abide.
So just how much is this going to cost you?
Let's do a quick example - assuming a Purchase Price of $400,000.00 and a 5% Down Payment. Here's the Math:
$400,000.00 Purchase Price
-$20,000.00 Down Payment of 5%
$380,000.00 Net Amount to be Mortgaged
+$15,200.00 Mortgage Insurance (AKA - CMHC, Genworth, Canada Guaranty Fees)
$395,200.00 Total Mortgage
PST applied to Mortgage Insurance Calculation:
$15,200.00 X 6% = $912.00
It's not terrible...but it sucks that it's nearly another grand you gotta come up with - what makes it suck even more is that this new charge cannot be added to your mortgage - nope...it's gotta be paid up front, when you visit your lawyer.
The take-away from all of this can be summarized by the following:
- PST on Mortgage Insurance is an Upfont Cost
- Effective August 1st
- It really really sucks to pay PST on Mortgage Insurance Premiums
- You can write your "thank you" letters to the Provincial Government for making it more expensive to become a home owner in the province of Saskatchewan.
Well, now that we've effectively ruined your day, we hope you can see the bright side in all of this (- umm, let us know what that is...cuz we are having a bit of difficulty with it too).
Keep on being awesome and don't forget to be kind to a stranger today - you just never know who's life you could improve with a bit of kindness.
BTW...and this is really just rubbing more salt in the wound...your Life and Disability and Home Insurance Premiums were also affected!