Refinance a rental property

5 Replies

Hi Everyone,

I am looking to refinance my 1st rental property that I bought 3 years ago in order to get a downpayment for a 2nd one! I have my primary residence mortgage and the rental property mortgage both through a commercial bank in Canada(RBC). I have a meeting to refi. set with them for 3 days from now, and I was wondering what kind of numbers they will need from my rental property ( eg. Monthly income, expenses, insurance, taxes, etc)?? Obviously I will need a recent paystub from my current job, and a tax assessment. I want to look as prepared as possible! 

Any help from my fellow Canadian investors is GREATLY appreciated!! 

Thank you in advance!  

If you hold the property in your name, they will want to see your tax returns including form T776 for the past 2-3 years.

If you hold the property in a company, they'll want financial statements for the company (minimum) and possible corporate tax returns as well.   If the property is held in a company, you would have personally guaranteed the mortgage ... so they will want your NOAs.

They will also want to see copies of your current leases.

Thank you for the comments. The process was very easy. I got more than I was hoping for, pending the appraisal. The rate in Ontario through the Royal Bank was 3.7% fixed over 25 years. I now have some cash for the BR in my next BRRRR!

@Jordan Salter - Glad you're happy with the process, is there a reason these are done through the Commercial side? This seems like a strange approach. 

You're likely in a much better position going with a Variable & 30 yr AM. My guess is there's some reason this needs to go on commercial terms that I'm missing here otherwise I'm not sure this makes a tone of sense. Would be happy to chat a bit further about this.

30 yr AM will increase your cashflow on the rental significantly & will allow you to qualify for more on the next purchase, this is usually a no-brainer.

@Jacob Perez

Based on his published rate (3.7% fixed ... likely a 5yr term) he likely has a residential mortgage.   I'm guessing his reference to a commercial bank was simply a choice of wording for conventional lender.

I agree with your position on using variable rate financing - particularly now where lender have build a generous hedge into their fixed rate products.  I'd rather hedge interest rates on my own by using variable rate and setting my payments to be the same amount as those for a fixed rate.

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