100% Financing – This allows homebuyers with excellent credit to finance the entire purchase price of the home without any requirement for a down payment. The major drawback to this program is that it carries a fairly high interest rate.
5% cash back mortgage – It is also possible to get a mortgage which will give you a 5% cash back on closing. This 5% can then be used for the down payment eliminating the need for you to come up with the 5% yourself. This can be a great program for those who have their money tied up in other investments, but still want to take advantage of the benefits that come with home ownership. The mortgage rate for this product is usually about 1.5-2% higher than the current markets lowest mortgage rate.
Borrowed down payment – Homebuyers with excellent credit are now able to borrow their down payment from a line of credit, or credit card. As long as the monthly payment on the borrowed funds can be verified. For example, as mortgage lenders are unable to verify money borrowed from friends or family members, these borrowed sources are not accepted. The down payment can however be gifted from an immediate family member and all that is required is they fill out a form, or type up a letter stating that the money is a gift and does not need to be paid back.
To qualify for a zero down payment mortgage, apply online now or contact your CityCan Financial Toronto mortgage broker for would be happy to help you out with all your questions.
Self Employed Mortgage
It can no doubt be a little more challenging for self-employed individuals to qualify for a mortgage due to the amount of income they are able to verify. There are mortgage lenders in Canada that understand that self-employed individuals have tax write-offs creating significant reductions in their declared income.
You are not required to prove your income and a reasonable estimate of your annual income will be acceptable
With these mortgage lenders, you will not be required to prove your income and a reasonable estimate of your annual income will be acceptable. This is what is known as a stated income mortgage and you can purchase a home on stated income with as little as 10% down payment and receive the same low mortgage rate as an income qualified borrower.
Notice of Assessments (NOA)
A Notice Of Assessment (NOA) may be required only to show that there are no income taxes owing. The income on the NOA will not have any effect on the applicant’s mortgage approval.
CMHC fee
Stated income mortgage loans will carry a higher CMHC fee than a mortgage loan with documented income. For example, the standard CMHC premium for a mortgage loan to 95% of the properties value and a 25 year amortization would be 2.75%. The premium on the same stated income mortgage loan would be 6%. The CMHC premium can be built right into the mortgage.
For situations where your credit may be less than perfect, a stated income home equity loan may be an option. With a stated income home equity loan, there is lower risk on the part of the mortgage lender due to the added equity in the home. The mortgage rate you pay may be a little higher on this type of mortgage loan then with a traditional stated income mortgage.
To qualify for a stated income mortgage loan, Apply Online now or contact your CityCan Financial Toronto mortgage broker today!
New to Canada Mortgage
Welcome to Canada! Just because you are a new immigrant does not mean that you have to wait to purchase a home. If you have been in Canada for less than three years, have landed immigrant status, and have been employed in Canada for a minimum of three months, you can qualify for a mortgage with as little as 5% down payment.
The main documentation you will need to provide to qualify with a 5% down payment will be:
A letter from your employer
A recent pay stub
12 Volume Pills months verifiable bank statements from a recognized financial institution*
*This can include a financial institution from your country of origin if you have been in Canada for less than 12 months. Also acceptable is 12 consecutive months of 2 verifiable monthly payments in good standing. (ie. phone bill, or utility bill). If you have a 10% down payment then 6 months of the information mentioned above will be sufficient.
Rental Properties
Rental properties with 1-2 units can be purchased with as little as 5% down payment or 10% down payment for 3-4 units. Providing that you have fairly good credit, you can use a borrowed down payment as long as it is from a source that has a verifiable monthly payment (such as a line of credit or a credit card).
Proof of rental income in the form of a signed lease agreement will be required as a condition of the mortgage loan. Employment income must be verified with a letter of employment and a recent pay stub.
Vacation Home or Cottage Mortgage
Owning a vacation home or cottage can be the perfect weekend escape from a hectic work week and provide countless memories for your friends and family. If the cottage has year round access, and is fully winterized with a permanent heat source, then it can be purchase with as little as 5% down payment.
If the cottage does not fit these requirements, but has a kitchen, 3 piece bathrooms, bedroom and a common area, then a minimum 10% down payment will be required. Qualifying criteria for a cottage mortgage can vary depending on the property and its location.
Vacant Land Financing
Whether you are interested in purchasing vacant land as an investment, for future use or to build your dream home, securing financing for vacant land can be somewhat challenging. Mortgage lenders look at vacant land mortgages as higher risk loans, and therefore interest rates are usually quite a bit higher than standard residential discounted mortgage rates in Canada.
If you have immediate plans to build, then you will be able to finance vacant land with a minimum 25% down payment. With no immediate building plans, the vacant land down payment requirements increase to 40-50% down payment. Financing vacant land can be very situational dependent and the amount required for down payment, qualification criteria and interest rates will vary from one situation to another.
