We have arrived on the cusp of another cold Canadian winter, and with so many families considering a move to the Great White North in the New Year, many people are left wondering what it takes to own a home here once they have arrived. Committing to an immigration is a difficult decision that comes with a seemingly endless wave of questions, considerations, applications, and forms to navigate, and this brief article aims to simplify at least one important step in this exciting international journey. The following four fundamental concerns for New-to-Canada mortgages should provide prospective Canadian newcomers with a deeper understanding of what will be necessary to secure a mortgage upon entering the country.
If you have already been in Canada for a couple of years, that is fine. You are still eligible for a New-to-Canada mortgage for up to 36 months, at which point you will be subject to all of the same guidelines that native Canadians must adhere to when looking to secure a mortgage.
Unsurprisingly, in order to acquire your mortgage, a down-payment will be required. While conventional mortgages often require as much as 20% of the purchase price paid in advance, New-to-Canada mortgages allow immigrants to work with a much more reasonable 5% minimum rate if transferring here as a result of a corporate relocation program. When immigrating here on their own without a corporate catalyst driving the move, newcomers will need to accumulate a 10% down-payment rate in order to buy a property.
You will need to prove that you have some sort of credit. This can cause some headaches for immigrants transferring over from countries that lack established credit policies, but fortunately there is some flexibility as to what qualifies as viable credit history in Canada. If you have lived in Canada for a couple of years without establishing any Canadian credit, you can show that you have paid your utilities on time, or can seek out references from your landlord showing that your rental payments have been on schedule every month. If you have recently moved from another country and have no way of providing a history of good Canadian credit, even through the alternative options listed previously, you can always provide a credit report from your country of origin, or you can get a letter from your bank vouching for your favourable banking history.
You will need to prove to your lender that you are able to make the mortgage payments expected of you. If you transferred here with your corporate company, you obviously have your salary to use as proof of income. If you have acquired a job in the time that you have spent in Canada so far, or if you are self-employed, you must show that you have paid Canadian taxes.
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