wardy_1990

Hello all,

New PR returning to Canada, i have worked there for 2 years before going back to blighty for some continental holidays with the Canadian wife. The mother in law is saying we cant get a mortgage unless we have lived there for a full year and have to put 20 percent down.

I am changing jobs to truck driving hopefully if any company's will take on a newbie, but as far as passing 3 months probation i cant see a problem with the normal 10 or 5 percent down.
Mainly its the one year required before you get a mortgage that is worrying me.

If anybody can shed some light on this i would be grateful

regards

wardy

Hasan78

Hi Wardy

not sure about 1 year rule. but depending on the bank you may have to put down 20-30% deposit and providing some docs like proof of income etc. I believe I was also asked for CRA Tax notifications, 3 month statement to show deposit amount. however as newcomer i doubt you will get a mortgage with 5% down payment....

Siouxie

You would still be classed as a newcomer under CMHC's 'newcomer' mortgage plan... as little as 5% downpayment. Your best bet is to go through a mortgage broker rather than a bank.

https://www.cmhc-schl.gc.ca/en/hofic...r/hopr_008.cfm and the cached pdf showing details.

You'll need to bring some documentation, if you don't have a credit rating here yet. The 1 year rule doesn't exist.

Collie

Some lenders specialise in lending to newcomers - but search the internet for recent news on the Home Capital Group if you're thinking of going down this route!

Shakyuk

I was told that there is some kind of insurance that is added on to your mortgage if you have a small deposit of say 5-10% of the value (I can't remember the percentage). I believe this insurance is pretty expensive and you must have it. Sorry I don't have much information on what I was told as I haven't researched it yet myself but just noting it may be worth looking into.

Aviator

Per post #3 https://www.cmhc-schl.gc.ca/en/co/moloin/moloin_005.cfm

plasticcanuck

https://www.cmhc-schl.gc.ca/en/co/moloin/moloin_010.cfm

Ebonhawke

As Siouxie mentions, its best to go through a mortgage broker rather than an individual financial institution. The broker will be able to comparison shop between a number of different lenders for the best rate, and will often usually spend time with you going over the different nuances of Canadian mortgage law in your situation

Shakyuk

That's what I was referring too, cheers, good information for me too

sharkus

the CMCH Mortgage insurance is typically required if you have a downpayment of less than 20%, though apparently there may be some situations where lenders still require it even if you put down 20% or more.

For a 500k place, with 10% down I think it's about 14k. There is also PST (8% for ontario) that need to be paid on closing for the insurance, so that'd be about 1200.

You could pay the full 14k amount up front, or bake it into your mortgage payments, which I suspect is what most would do.

dbd33

It's worth noting that the CMHC charges a one time fee based on the mortgage ratio when you start. If you spread the 14k over 5 years of mortgage payments then immediately win the lottery and pay off the mortgage, the fee is still 14k even though you would have been paying it a rate of 14K/5/26 and the CMHC would have been on risk for 5 years.

If you're close to being able to avoid paying the fee then it'd be worth smashing into some parking meters to go from a 14.8% deposit to a 15% one.

Shakyuk

It's worth noting that you shouldn't smash into parking meters if you happen to drive a moped...

dbd33

Well, yes, also they're mainly electronic now and contain no cash. I'll rephrase. If one is close to avoiding having to pay the CMHC insurance premium, a significant expense whether paid at once or added to the mortgage repayments, then it would worth turning a few tricks to do so.

unique at last

Also worth noting that if you go into trucking, you'll probably be paid per mile and so you'll likely need 2 years worth of pay slips before you can apply for a mortgage. We've been told that by RBC, Scotiabank and a mortgage broker (for A class lenders anyway and B class lenders won't lend in small towns so not available to us anyway). We're going to see the bank we use tomorrow to see if they'd relax that for their own customers (we have 1 year's worth).