The Globe and Mail’s Rob Carrick is being heavily criticized for a bit of advice he’s offered in his latest column.
He suggests that Canadians young and old waiting to buy a house should ignore a specific piece of financial advice that has been quite popular the last number of years: Put LESS than 20% down on a house!
A minimum 20% down payment means you avoid paying a huge premium on your mortgage to protect your lender in case you end up defaulting on payments.
Carrick argues that if you wait a few years to save enough to dodge the premium, soaring house prices will actually offset that savings on mortgage insurance.
He goes on to explain that the 20% threshold is a smart one, but NOT in a hot market.
Do you agree with his advice? Is this the worst possible advice to give to somebody trying to decide their housing fate?
Read Globe and Mail’s financial columnist Rob Carrick’s full column HERE.