35,000 home buyers plan

Aside

35K Home Buyers Plan35,000 home buyers plan

Raising the amount allowed to be borrowed from your RRSP’s savings account from 25,000 to 35,000 to be used as a home down payment is a “Plan” that one of the candidates for the prime minister’s office is looking to champion

So far this is only a “Plan”, but how interesting is that to you as a borrower?

How does contributing to your RRSP savings account helps you?

  • Saving for your retirement
  • Gaining generous dividends from your savings
  • Tax shelter (Differing paying taxes until you reach retirement age)
  • Borrow from your RRSP savings towards the down payment of your home

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Tax sheltering works in the following way:

If an employed person makes 50,000 a year, he/she will be deducted about 8,000, (check your T4 at the end of the year) if that person is able to contribute 10,000, before the end of the year or March 1 or Feb 29 on leap years, then after filing taxes, the return for this contributions should be around 1,800+

(These values are not guaranteed to be accurate. For informational purposes only)

Repeat this operation for a couple of years more and you’ll have saved a substantial home down payment, and don’t forget that this are amounts per person, if you area couple, you can add to the equation the correspondent amounts of the second person.

Your RRSP’s contributions plus their gains can be borrowed towards the home down payment after they have been in your account for at least 90 days

Does the “Plan” motivates you to increase your RRP’s contributions with the intention of using them later as your down payment to purchase a home?

Below you’ll find a quick poll that will help us all get a more general perspective, the more people participates, the greater perspective of the choice we all may have, so feel free to share this link with those you know

 [socialpoll id=”2290157″]

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Bank of Canada lowering rates

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Bank of Canada Lowering interest ratesBank of Canada lowering the Canadian overnight loans rates unexpectedly from 1.00% to .75% in response to the fall of the oil prices.

Canada is the first of the group of 7 richest countries to adopt such a measure, and the following is Canadians should expect in regards to their mortgage:

  • Lower mortgage rates. In fact we have received from our lenders new revision of their mortgage rates bringing them to a new low.
  • Depending on the performance of their funds, some Canadians should expect lower expectations in the growth of their wealth.
  • We have also seen some news from oil related companies experiencing massive layoffs due to the fall of the prices if oil
  • The International Monetary Fund has also lower their growth expectations of the Canadian economy and other countries for the year 2015

This could be summarized to an advise to those borrowers who are thinking about purchasing a real estate property to go ahead as soon as possible if they to enjoy the benefit of paying less and being easier to qualify for those with a tight budget, and for those who have being saving in RRSP’s this might be the best time to borrow them towards their down payment

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Zero Down payment mortgageNew To Canada Mortgage

Non owner occupied rental mortgage

Non Owner Occupied Rental

The non owner occupied rental mortgage loans help you qualify by adding the monthly rental income to your current income. As a result you are able to purchase or refinance a rented property and let the property pay for itself with the rent

Scenario: You currently have a steady job or business, a decent credit score, some savings but no time to start another business or job, and you would like to earn residual income from a real estate property.

The non-owner occupied rental mortgage is designed for those who would like to become real estate investors.

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New To Canada Mortgage

 

New To CanadaNew to Canada Mortgage is for people who have immigrated or relocated to Canada within 60 months, offers credit record or history flexibility, lower down payment required than a conventional mortgage.

The New to Canada  mortgage is for the new immigrants that have obtained landed status and have not already owned a house It presents the opportunity to start owning a home instead of renting.

The following are some borrower qualifications for the New to Canada Mortgage:

  • High ratio secured mortgage loans with only 5% Down payment from own resources; For LTV’s less than 95%, the remainder may be gifted from an immediate family member or from a corporate subsidy. (3 years landed immigrant)
  • Or Conventional unsecured mortgage loan with 35% Down payment or more from own resources.
  • Amortization up to 30 years in Conventional & 25 years insured mortgages
  • No 3rd party/Guarantors

  • Number of units, Max 2

  • Must provide valid work permit or verification of landed immigrant status

  • International Credit Report or 2 alternative sources of credit

  • Bank reference letter or 6 months bank statements
  • 3 months minimum full-time employment in Canada (borrowers being transferred under a corporate relocation program are exempt)
  • All debts held outside of the country must be included in the total debt servicing ratio (Rental income earned outside of Canada is to be excluded from the GDS/TDS calculation)
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Zero down payment mortgage

Zero down paymentZero down payment mortgage is a Mortgage loan offered by only some lenders that offer a 5% cash back, that can be used towards the down payment.

It helps realize the dream of home ownership even before the down payment has been saved.

If you are currently renting and prefer to own your own home, but you haven’t been able to save enough for your down payment, this is your chance call now

To qualify for a Zero down payment mortgage you to have good credit (read below), a steady source of income that can show your capacity to repay the loan, (we’ll do the math together) and savings of about a 1.5% of the value of the property that you are seeking to purchase

These mortgage loans are not available for borrowers that:

  • Are prior bankrupts, consumer proposals, collections or repossession
  • Have high credit cards or other consumer loan debt with no assets and no evidence that they can save
  • Have no assets to show for the length of their working career

 Visit also low credit score mortgage 

* Subject to availability

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First mortgage

First MortgageFirst mortgage is the first loan registered on the real estate title.

Looking to buy your first home?

Save thousands on your first mortgage, know your options & get approved

Other mortgage loans can also be registered on the same property title, they would be called second or third mortgages

Reading the following will help you get approved when applying for your first mortgage

You are excited about buying your home and wouldn’t like disappointments, if this is the case read the following:

  • Is smart to have your mortgage assessment practiced before you start viewing homes, that way you’ll know what you can or can’t afford.
  • Learn about the unique advantages you are entitled to if you are a first time home buyer
  • Learn about your credit and mortgage loans and credit score
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