Should You Borrow Money to Make a Down Payment on a New Home? + MORE Mar 26th

Mortgages in Canada can be a murky subject – one that we hope to shed some light on with a series of highly informational articles.
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Reaction to CMHC’s New Restrictions on Insured Mortgages Jun 7th

Obtaining mortgage insurance for a home purchase is about to become more challenging on July 1, particularly for first-time buyers. The Canada Mortgage and Housing Corporation (CMHC), Canada’s national mortgage insurance provider, unveiled stricter underwriting policies on Thursday for insured mor.... More »

9 Ways to Keep Your Credit Score as High as Possible (Part II) Jul 10th

In our previous post, we spoke about the fact that there are so many credit score providers out there, all providing different results, and chances are none of those results are the credit score lenders see when you apply for a loan product such as a mortgage, credit card or car loan. How are you su.... More »

CMHC tightens mortgage rules in latest response to COVID-19 + MORE Jun 10th

On June 4, 2020, the Canadian Mortgage and Housing Corporation (CMHC) announced changes to the eligibility rules for mortgage insurance, in the agency’s latest response to the COVID-19 pandemic.  The new rules will lower the amount of debt an applicant for an insured mortgage can carry, set a hig.... More »
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Mortgage Lenders Provide COVID-19 Update – Part 2 + MORE Apr 16th

In a recent series of panel discussions put on by Mortgage Professionals Canada, a cross-section of some of the country’s top lenders and insurers provided updates on how the COVID-19 pandemic has impacted operations and shaped their outlook. Similar to the previous sessions, the overwhelming mess.... More »

Latest in Mortgage News: Newton to Provide Free TransUnion Access to its 6,000+ Velocity Users + MORE Jun 28th

Starting today, the more than 6,000 mortgage brokers who use the Velocity mortgage operating system will gain free access to TransUnion credit reports for the remainder of the year. The offer is part of a campaign by Newton Connectivity Systems, which operates Velocity, to encourage greater diversif.... More »
Should You Borrow Money to Make a Down Payment on a New Home?
Saving for a mortgage down payment can be a long and tedious process. According to the Canadian Real Estate Association, the average price of a Canadian home was $540,000 in February, a 15.2% increase compared to a year earlier. You would need to save $108,000 just to make a standard 20% down payment. Faced with rising home prices, some Canadians choose to borrow money for their down payment.
How to Borrow Money for a Down Payment?
Borrowing money for a down payment is certainly possible, though you’ll have to put up some of the money yourself. Lenders require a minimum of 5% of the purchase price up to $500,000 and 10% over $500,000. You may be able to use other loans to help with your down payment, but only after the lender’s minimum requirements are satisfied. For example, if you’re buying a $500,000 home and have $25,000 in savings, you could use a personal loan to cover the rest of the down payment.
Advantages of Borrowing for a Down Payment
With interest rates at historic lows, borrowing for a portion of your down payment might make sense in the right circumstances…

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6 month mortgage deferral will help, not harm, despite what media say.We’ve all heard about the 6 month deferred mortgage payment option.  It was thrown out there by the government in an attempt to help property owners.  We now have some more info that I’d like to share.
I’m getting a little sick and tired of the media being so negative and pessimistic.  The banks and other financial institutions are offering to defer mortgage payments for 6 months. This is GOOD news. While it might not seem that way if you read some of the media posts, let’s clear things up:

 NO, it won’t harm your credit rating.
 NO, it isn’t expensive. Read on…
 NO, this isn’t automatic. Your mortgage payments will not be forgiven for 6 months without calling anyone. But most lenders are happy to postpone your payments without much fuss.

This is for people that have had a change in their incomes. If you are fortunate enough to have a job where you are still working, or you work for the government and there has been no change in your employment or your investment property income has not changed,  please don’t call the lenders…

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Last week, the President of the Canadian Bankers Association announced that all six major banks would offer deferral payments on their mortgages and other credit products. Just like many public announcements over the last couple of months, many were left with more questions than answers. One question that still has yet to be answered is, how deferred mortgage payments might affect your credit score? Equifax recently announced, “In the event that a [lender] makes a credit relief or payment deferral […]

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