Edmonton, Alberta · Member since 2017 · 32 posts · 13 votes
Hello, looking to add some Canadian BP members or join to some groups. Im new to real estate and as useful as BP is Canada has different guidelines laws to follow. I won't be annoying and message you constantly I promise! Any help is appreciated, thank you!
@Roman Stefaniw The new rules taking effect are for those with 20% down or more having to pass a "stress test", which is not only qualifying for the mortgage at the actual interest rate, but needing to qualify for it at the posted rate (which for a 5 yr fixed is I think 4.99% right now). Last year the same stress test was applied for borrowers with less than 20% down, so really they've just extended it - HOWEVER, in theory that only applies to federally regulated banks, which if you go through a provincially regulated credit union, in theory they are not obligated to follow the rule. Whether they do or not is up to them.
Word of advice though if you're looking at taking a mortgage you see yourself paying out or refinancing - go with a variable mortgage, as the payout penalty is usually only 3 months of interest. On our first flip I didn't know that and had a 5 year fixed, and got hit with an interest rate differential penalty - $7200! I'm currently getting a mortgage on a different property, and if I went through Scotia with their 5 year fixed, if I paid it out in the next 4 years, the penalty varies between $11,800 - $12,750. So be very clear on your prepayment penalty fees before you sign your life away. They can still do ports but with restrictions, and then they'll give you a blended rate, and the 2 mortgage components don't ever come due at the same time, and it's messy. Generally do not recommend, though I did it on one property and the lender gave me back my prepayment fee in full from the property it was ported from.
If you're doing a BRRR, as far as I'm aware you can get up to 80% LTV. I am currently doing a refinance and they have told me as long as I have 20% equity in it, I can take out as much as I want.
CMHC/Genworth need to be owner occupied and they do charge quite a bit for the premium (I think about 4% but I could be mistaken, haven't had to use it in a while). So it can easily add $10k+ to your numbers, but if the alternative is being able to get into real estate or not, then it could very well be worth it for you.
Hi guys, I’m a newbie in Toronto :) Found out about this forum yesterday and signed up immediately. A little bit about myself, I have been doing short-term rentals in downtown Toronto for 2 years now and I am looking to get into other fields after I graduate from university this year. I am too looking for mentors to connect, and maybe join some local groups if there’s any. If you are interested in short-term rentals feel free to connect and I’ll be more than happy to share my experience :)
Hi everyone, I am Ottawa based US investor. I have been investing in upstate NY for a few years now. In addition to being a US real estate investor I run my own cross border tax return consulting and tax preparation business. Feel free to reach out if you have any questions or would like to connect.
This thread has been really great for some new knowledge and I would like to see it carry on.
So now what?? Ive offered on my 3rd property and this is where the banks start to cease up. What kind of financer should I go to next?
Jack:
If you are acquiring residential (1-4 unit or 1-5 unit w/ CIBC, 1-6 unit with RBC) properties and your ratios are strong, you should not encounter any real issues from the Big-5 until you reach 5-7 mortgages.
@Roy N. that was my general opinion, but there has always been this need to have 100,000 in what they describe as liquid cash, their rule was it couldn't be in a registered accounts. As I have just found out today, they will allow me to have 70% in registered funds to make up this amount so we will see how this goes as it totally changes things for me.
Talk with a different lender. Among the Big-5, it has been our experience that RBC bows out first - they will only underwrite up to a total of 5 residential mortgages; Scotiabank, TD and CIBC get more strict in their underwriting after 5-7. We have never used Banaque de MTL. We have also encountered lenders who would count the debt of a commercial mortgage against us when applying for residential financing, but not allow a percentage of rents from that commercial property to be included in income.
Once you arrive in the region of 10 mortgages, they all have ridiculous capital reserve requirements: CIBC wanted us to have $1-million in liquid assets when looking for a mortgage of ~$100K (at the time of purchase).
The Big-5's internal guidelines fluctuate over time to fit their portfolio composition requirements - sometimes they are hungry/open to place mortgages on rental properties, sometimes they are reluctant - which is why you need to keep a rapport with several of them ... or use a mortgage broker.
Hello everyone, I'm from Vancouver, BC and I enjoy reading, learning and sharing best practices with other investors here on Biggerpockets. Thanks to my mum's guidance, I bought my first property while still in university, later leveraged that to buy the next and next and next property. As an independent licensed mortgage broker, I have access to many many lenders that can help me expand my portfolio.
@jack young I posted this article titled, "What type of lenders do you need to finance your portfolio?"
Keeping a rapport is a great idea @Roy N., but I'm curious about how I should go about something like this as they hardly want to see you in their office if they aren't signing over every thing you have into their book of business! It really gets frustrating to have a conversation, learn, present ideas and just get to know them and how things work in their bank. Twice now, the banker will not even make an appointment with me until I had everything available for them and I do mean everything. I get incredibly frustrated with their attitude and cant help but wonder how they expect me to want to bring my business to them in any form or be able to compete for my business without starting somewhere, even if it is just one mortgage to start. How they have been doing it is boarder line unethical in my books.
I seem to have skipped over the door count lender in your article @Julie Toh. It would seem as if they don't use the DCR method and this building puts me to 11 doors if all goes well. How would they look at a deal in this scenario?
You first need to find bank mortgage agents and a local mortgage broker - you will need both as some of the banks do not provide brokers with the same access their in-house agents have - who truly understand investment properties ... or who are new and willing to learn ... and, consequently, see the benefit of building a long-term relationship with an investor.
My experience has been word of mouth is usually the way you find these folks ... most bank mortgage specialists and residential mortgage brokers bread and butter are financing pretty houses for Dick & Jane. Underwriting such financing is generally less effort than an investor who already has half-daozen mortgages, so they are not keen on working with investors.
@Roman Stefaniw
From Ottawa, I’ve been investing in NY and doing cross border tax for a few years now. Feel free to reach out if you have any question.
Hey everyone just getting started in RE in the Edmonton market. Currently house hacking right now and my business partner and I have recently secured financing to do a fix and flip this winter. Looking at properties as we speak with our Realtor. Like seeing all the Canadians on the forum!
Hi everyone. I'm new to Canada, currently living in Toronto but looking seriously into opportunities in Ottawa because the returns for buying and holding and renting out seem very low here, and because I am interested in moving to Ottawa. I recently moved from the US, where I sold properties that were yielding much more cash flow than I have seen here so far. I'm looking to connect with other Canadian investors, especially those in or with experience in Ottawa.
@Kate H. Welcome to Canada! A lot of Canadian's are investing in the US for that cash flow you just mentioned :)
The best cash flow investments in Ontario are student rentals, rent to own, and multifamily. Student rentals obviously in any university/college town, rent to own anywhere, multifamily especially in the lower priced areas of Ontario like London, Windsor, the Niagara Region, parts of Cambridge, Hamilton, and several towns along the 401 between Kitchener and London and between Oshawa and Kingston.
There's also still good rental opportunities in the eastern provinces.
Right now the market is flat or declining in most of Alberta, it's a fantastic time to pick up very favorable seller financing in the Calgary - Edmonton corridor.
If you are in the Southern Ontario area, there's an awesome meetup in Burlington called The REITE Club (Real Estate Investment Training & Education) meeting every month or so at the Holiday Inn on Guelph Line. 120 or so people super pumped for REI info. Everyone seems eager to share & learn. Very cool evening.
Next Meetup is Oct 4/18 7-10 pm
Excellent networking opportunities for old & new investors.
Hi all I live in Northerner Ontario North Bay a nice sized university town where I do student rentals Have also been active in the states for several years always willing to chat with fellow Canadians
I'll speak up to represent the London Ontario region. I've been running a meet-up on the Bigger Pockets event platform for two and a half years without missing a month. I really enjoy connecting with new people, whether very experienced or totally new as long as they're personally committed. Feel free to connect and watch the Events section for the next meet-up in London, or join the facebook group: https://facebook.com/groups/BiggerPocketsLondon/
Hi folks...Alon here from Toronto, Ontario. Really happy to see so many people from Canada. Looking forward to making some connections and friends. Tons of amazing information on this site and so many people happy to help...really great to see!