newcanadafamily

New to Canada? Here’s some Helpful Home-Buying Advice

Welcome!

You’ve chosen to live in the best country in the world, so congratulate yourself.   As a child of immigrant parents, I know firsthand of the possible challenges ahead of you.  I hope to answer any questions you may have regarding purchasing a home in Canada as a new immigrant.

Did you know that if you’ve immigrated to Canada within the last five years, you can purchase a home with as little as 5% down?  Here’s what you need to know:

Qualifications

  • As mentioned above, you must have immigrated or relocated to Canada within the last 60 months (5 years)
  • You must be employed full time in Canada for a minimum of three (3) months.  If you have transferred under a corporate relocation program, you are exempt
  • You must have a valid work permit or obtained landed immigrant status
  • For purchases with 5% down, the down payment must not be borrowed.  If you are putting more than 5% down, the balance can be gifted from an immediate family member or from a corporate subsidy

When applying for a mortgage under the New to Canada program, the lender will ask for the following documentation:

  • Valid work permit or verification of landed immigrant status
  • Income confirmation
  • Down payment confirmation
  • Purchase and sale agreement
  • Letter of reference from a recognized financial institution
  • Up to 12 months of bank statements from the primary borrower’s account
  • International credit report demonstrating a strong credit profile or two alternative sources of credit demonstrating timely payments (no arrears) for the past 12 months.  The two alternative sources required are:
    • Rental payment history confirmed via letter from landlord and bank statements
    • One alternative source (hydro/utilities, telephone, cable, cell phone and auto insurance) to be confirmed via letter from the service provider or 12 months billing statements

What’s next?

Apply for a secured credit card.  This will allow you to start building your credit worthiness in Canada.   Once you start using the card, it will report to your Equifax and Transunion credit reports.  These credit cards are issued by many providers, including the banks.

I recommend contacting a reputable mortgage broker who is able to provide you with a full pre-approval.  This involves reviewing all of the above documents to ensure they meet lender and mortgage default insurer guidelines.

Once your pre-approval is complete, locate a realtor who can assist you with finding your perfect first home in Canada.  If you need an introduction to a realtor, please let me know as I work with many reputable real estate professionals.

Lastly, certain cities in Ontario offer the Affordable Home Ownership program.  To see if your city offers it, contact your local councilor. As an example, Mississauga, London and Waterloo are currently offering the program.  They provide you with the 5% needed for your down payment.  For full qualification rules, please contact the city directly.

As always, if you have any questions, please do not hesitate to contact me at maria@heritagelending.com.  It would be my pleasure to assist you with your first home purchase in the country I love.


Source:  Genworth