Down payment requirements for mortgages in Canada

Archives for August 2017

Down payment requirements for mortgages in Canada

In 2014, Calgary mortgage broker Steven Crews, from Verico iMortgage Solutions, did a series of radio broadcasts about mortgages and mortgage financing for Shine FM. Have a listen and you’ll pick up some helpful tips…

Historically, first-time buyers were the only groups permitted to get a mortgage with a 5% mortgage down payment. Now everyone can purchase a home, whether it’s your first or next home, with a 5% minimum mortgage down payment.

Recently, I heard from a few clients who thought that they needed 10% down to purchase a home. They thought that only first-time home buyers could purchase with 5% down.

In fact, anyone can purchase a home with as little as 5% down. When you purchase a home with less than a 20% down payment, it’s called a High Ratio Insured Mortgage. A High Ratio Insured Mortgage, is insured by one of either CMHC, Genworth or CG. The insurance is for the bank, in case you can’t make the mortgage payments, and allows them to lend more than 80% of the value of the home.

Providing 20% or more as a down payment is called a conventional mortgage. Typically, the bank doesn’t require any insurance to lend up to 80% of the value of the home.

Last year, the government made some changes to the lending regulations and High Ratio Insured Mortgages. Today, if we want to refinance a home that we currently own, we can only refinance up to 80% of the value of our home with most lenders in Canada. That means it takes 5% down to purchase but 20% in equity to refinance.

Do you have a question or topic that you would like to learn more about? Let me know. If your question or topic is used on the ShineFM Mortgage Expert segment you will receive something special!

Second Mortgages

Are you planning to invest in a new house and are thinking of applying for a home loan? Since your mortgage broker will provide you with a host of lenders according to your home loan requirements, it is crucial that you select an experienced, accredited, and proficient broker. Verico iMortgage Solutions is one of the finest mortgage brokerage companies in Calgary who can provide you with the perfect solution whether it comes to pre-approved private or second mortgages, refinancing, or home equity loans along with a Canadian home customized plan.

Here, are 3 crucial things to keep in mind while choosing your mortgage broker. Take a look.

  1. Recommendations

Do not go for a random selection while choosing a broker from the unsolicited adverts and online searches. Take recommendations from reliable family members, friends, or acquaintances who have prior experience in dealing with a similar financial situation and have been rewarded with the efficient service of a broker.

  1. Understanding

Such financial matters can be a little overwhelming and complicated to understand, especially if this is your first encounter with the process of home loans. Choosing a good mortgage service like ours will enable you to get a better understanding of these issues involving complex mathematical calculations and other monetary ideas with our highly communicative and competent staff who will be patiently answering to all your queries, along with updating you from time to time with latest developments.

  1. Options

If you have a number of lenders before you, it becomes easier to choose from a wide range of loan options. Therefore, you must opt for a mortgage broker service that partners with various kinds of lenders and provide their products to the borrowers.

So, what are you thinking? Quickly give us a call at (403) 870-2669 and get started with your project of a dream home. Our expertise and services have an unrivalled match in the market and we will surely not disappoint you.

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