Why use a Mortgage Broker?
- Receive professional negotiating expertise.
- Convenience and access to numerous new mortgage products.
- Unbiased knowledgeable advice.
- Access to unadvertised rates.
- I work for the YOU, not the bank.
What is the Home-buyers plan?
- Is a Federal Government Program that allows home-buyers to use $25,000 for each purchaser from his/her own RRSP.
- You must not have owned a principal residence within last 5 years.
- You must intend to occupy your home as a principal residence.
- Minimum repayment is 15 equal annual instalments. This schedule can be accelerated.
- The funds to be withdrawn must have been invested into the RRAP for a minimum of 90 days prior to withdrawal.
- You must complete a Form T-1036.
Do I qualify for the 5% down payment program?
- The home must be located in Canada and is to be occupied as your principal residence.
- You have from your own resources a down payment of at least 5% of the purchase price of home.
- Your mortgage payment must not exceed 32% of your gross household income. This includes payment of principal + interest + property taxes + heat + condo fees (if applicable).
- You must be able to cover closing costs equivalent to at least 1.5% of the purchase price.
- You meet the lender’s eligibility requirements regarding income, employment and credit worthiness.
What should I expect for closing costs with a traditional lender?
(Closing costs are approximately 1.5% of the Total Purchase Price.)
- Appraisal Fee
- Legal Fees
- Title Insurance (if applicable)
- Survey Certificate (if applicable)
- Home Inspection (if applicable)
- Tax Adjustment (if applicable)
- Interest Adjustment (if applicable)
- Property Transfer Tax (if applicable)
Purchase Requirements Based on Income Type:
- Job Letter – Lenders use 100% of the income. Verification is made on company letterhead, signed by appropriate individual. If you are a recent hire, the letter should confirm that probation period has passed. Bonuses, car allowances, and other forms of remuneration should be mentioned in letter if applicable.
- Pay Stubs – Many Lenders will also require your most recent pay-stub(s).
- Pay Stubs- showing year-to-date income verification
- T4’s and/or Personal Tax Returns (T-1 Generals)- 3 years to take an average
- Notice of Assessment (NOA)- most recent to confirm no taxes owed.
- T-4’s and/or Personal Tax Returns – 3 years to take an average
- Job Letter- confirming position
- Notice of Assessments (NOA)- optional depending on Lender
- Financial Statements of Company – 3 years average net income used. Depending on Lenders policies, The add-back of various personal expenses run through company may or may not be allowed. (examples of allowable add-backs- Depreciation, Amortization, Capital Cost Allowance).
- NOA’s (Personal Notice of Assessments) – 2 year history
- Personal Tax Returns (T-1 Generals showing personal net income) – 2 year history
- Overtime will be used if there is a proven track record. 3 years evidence (T-4’s)
- Bonuses – Once again, a 3 year track record required
- Part-time job – should be in place for a couple of years before using additional income
- Tips- Generally not recognized unless declared
- Car Allowances – Varies from lender to lender
- Alimony and Support – Evidence that payments have been made regularly and a copy of divorce agreement is required. Investment Income – must be received continuously. This source of income is limited to interest, dividends, or some type of ongoing revenue. Capital gains, which result from the liquidation of an asset is a 1 time occurrence and can’t be used.
Do not hesitate to call or email with any additional questions.