Cash Back Mortgages
Some of our lenders offer a product known as a cash back mortgage. This is where the lender pays you back cash at the time of closing. The amounts can be 1.1%, 1.5%, 2%, or 3% of the purchase price. The cash back is a nice option for people who need the money to pay out debt to qualify for the mortgage and otherwise don’t have it, or for people who need a little extra cash at closing for things like new furniture and appliances, or just to put in a savings account for an emergency fund. Cash back mortgages are only available on 5 year terms and have a slightly higher interest rate than normal mortgages, as the cash back loan must be re-paid over the mortgage term.
Flex Down Mortgages
Flexible down payment mortgage is one in which you can use borrowed funds for all or part of the down payment. This type of product is ideal for those with good credit, stable income and are just short on the savings for the down payment required. The client upon qualification is able to borrow the down payment from a financial institution and then proceed with the mortgage. In some cases we may be able to assist with securing the down payment required. Many lenders offer this product and usually at only a slight rate premium from a traditional mortgage.
If you are self-employed, it can be tougher to secure a mortgage if the amount you pay yourself doesn’t reflect your total earnings. We have many lenders that will allow non traditional income verification for self-employed borrowers such as income add backs, stated income or the use of business bank statements. These products are available through a number of lenders and we can assist with what mortgage will suit your needs and situation best.
New to Canada
If you have just recently immigrated to Canada is the last 5 years and are working on establishing a credit and income history we can still help you purchase a home. With permanent residency status you can purchase with as little as 5% down, and with a valid working permit plus application for PR status you can purchase with as little as 10% down. Since you may not have a thick credit history, our lenders will look at alternative ways of verifying credit worthiness such as proof of rent and utilities paid on time, as well as history of positive money management and savings. A two year history of income is also required unless income is guaranteed (salary or guaranteed hourly). Contact us for more information or to start a financial plan to purchase a home.
Purchase Plus Improvements
Almost all of the lenders we work with allow money to be added to the mortgage for permanent renovations. This is a very popular product these days when the majority of borrowers have experienced a reduction in purchasing power due to the new government stress test. As a result, borrowers may have to purchase a less expensive home which may require renovations. Many borrowers especially first time buyers may not have the funds to complete renovations after providing a down payment. Therefore adding funds to the mortgage is a perfect option. Typically improvement cost can’t exceed approximately $40K or 10% of the mortgage amount (some exceptions are granted) and must be used for permanent improvements such as new flooring, painting, new furnace, new roof, garage build, etc. For more information on how to apply for a purchase plus improvements mortgage contact us today!