Are you a first time buyer?

Here is some information which you may find useful as you prepare for your journey to home ownership.

HERE is a short video on why you should use a Mortgage Broker.

HERE is a mortgage calculator if you want to play around with the qualifying options and different scenarios.

Here is an overview of what is going to be used for qualifying your mortgage:

Income 

They will typically use the average of your last 2 years for income (unless you are guaranteed a base income).

• HERE is a short video on how they determine your maximum purchase price.
• HERE is a short video on the stress test and how it works. 
• HERE is a list of the basic required documents.

Credit

Here is brief overview of what most lender and default insurers are looking for:

• 2 different sources of credit with limits of at least $2000
• 24 months of no missed payments and established credit reporting 
• Here are the 2 credit reporting companies where you can check your own credit (without it impacting your score)- Equifax and TransUnion 
• Here is some more information on credit scores and how they are determined
• Here is where you can pull your free Equifax report

Down payment 

The minimum down payment is 5% and they will also want to see that you have at least 1.5% of the purchase price available for closing costs. This can come from your savings, investments, gifted and occasionally borrowed (on exception). They will want to see a 90 day history of your funds so just be mindful of that if you are transferring funds between accounts. The Government currently has a down payment program for First Time Buyers. You can find more details on this program HERE.

Property

Certain types of properties (such as mobile homes or log homes) can be more challenging to finance. Lenders are typically looking for marketable properties, in good condition. If the property has a suite, some lenders will allow us to use that income for qualifying as well. 

There are a few programs specifically designed for First Time Buyers as well:

• Transfer tax exemption 
• RRSP withdrawal
• Tax credit

The default insurers each have a home buyer guide which you may find useful. Here are the links to each:

• Sagen
• CMHC
• Canada Guaranty

We have a monthly newsletter if you wish to stay updated as well. You can sign up HERE.

Finally, HERE is an application for whenever you are ready to get started.