New Immigrants – Buying your first home.

//New Immigrants – Buying your first home.

New Immigrants – Buying your first home.

GETTING PRE-APPROVED BEFORE SHOPPING

It’s a good idea to sit down with your mortgage broker/ specialist to discuss your needs and get mortgage pre-approval.  Pre-approval means that your lender commits to giving you a mortgage up to a specified amount, at certain terms and conditions, including the interest rate. This commitment will be valid for a specific period, usually up to 90 days. Pre-approval doesn’t lock you into the mortgage. You are still free to pursue other arrangements. That way, you know exactly how much you can spend on your new home.

If you are buying a home using CMHC Mortgage Loan Insurance, you will need to get your home loan from an approved lender. For a complete list of banks, trust companies, credit unions, and other financial institutions  approved to give loans insured by CMHC, contact your mortgage broker / specialist.

DOWN PAYMENT AND MORTGAGE LOAN INSURANCE

The amount of your mortgage will be determined by the price of the home minus an initial cash payment (called the down payment) made up front. If the down payment is less than 20% of the value of your new home, your lender will probably require “Mortgage Loan Insurance”.  In addition to a lower down payment, Mortgage Loan Insurance will help you access interest rates that you otherwise wouldn’t have been able to negotiate. The cost for Mortgage Loan Insurance, called a premium, is usually offset by the savings you get from lower interest rates.  CMHC is Canada’s leading mortgage loan insurer. We have helped newcomers with permanent resident status become homeowners with a minimum down payment of 5% regardless of how long they have been in Canada. Non permanent residents can also purchase a home with a minimum down payment of 10% of the value of the home.

Ask your mortgage broker / specialist about features and associated premiums related to CMHC’s Mortgage Loan Insurance.

Mortgage Loan Insurance is not the same as mortgage life insurance, which pays off your mortgage in full if you or your spouse dies.

CREDIT SCORE AND HISTORY

Credit and work history are very important when trying to obtain a mortgage. Unfortunately, as a newcomer to Canada, you may not have a credit history that is accessible to Canadian lenders. If you want to buy a home, it is important to begin building a new credit history as early as possible. Talk with your bank. They will be able to help you get a credit card and plan to build a credit history that will help you buy your home.

Here are some tips that will help you show that you are able to repay a mortgage:

1.  Open a bank account and use it regularily,

2.  Consistently pay your bills on time, including rent, utilities, cable and insurance premiums.

3. Apply for small loans from your bank to begin proving that  you can pay on time.

4. Apply for a credit card.

5. Try to remain with the same employer for an extended period of time.

For a fee, you can obtain your credit score and report. Visit the website of one of the following credit reporting agencies to find out how to obtain your credit report:

Equifax: http://myservices.equifax.ca/CDN40_prdlist

Trans Union: www.transunion.ca

Our Mortgage brokers have the experience and knowledge to get you started on the next chapter of your life as a homebuyer.

By |2017-01-04T00:58:57+00:00February 10th, 2014|Uncategorized|0 Comments

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