All Forum Posts by: Julie Toh

@Jatinder A. Welcome to BP!

@Jatinder A.

Getting a mortgage for a leasehold property is not any more difficult if you know which lender will finance it. If you're purchasing this as your principal residence, the source of your down payment from be from your own resources e.g. savings, RRSP or gifted from your closest relatives. 

@Kelvin Truong Welcome to BP and to the world of real estate investing. Besides reading helpful resources and learning, learning, more learning, I also find it helpful to have an active real estate investor in my orbit as a sounding board. This person can be a realtor, mortgage broker, CPA, etc. 

@Conor Kelly

Update to quidelines changes for HELOCs.

Qualifying for a HELOC may not be the slam-dunk you expect it to be, and even if it was, HELOCs aren't a guaranteed source of home equity liquidity. Accessing property wealth has, and will continue to be, an important component of later in life financial planning. There are home equity financing alternatives beyond selling your home and HELOCs.

https://business.financialpost.com/real-estate/mortgages/canadian-banks-expected-to-tighten-home-equity-access-as-aid-measures-wind-down

Qualifying for a HELOC may not be the slam-dunk you expect it to be, and even if it was, HELOCs aren't a guaranteed source of home equity liquidity. Accessing property wealth has, and will continue to be, an important component of later in life financial planning. There are home equity financing alternatives beyond selling your home and HELOCs.

https://business.financialpost.com/real-estate/mortgages/canadian-banks-expected-to-tighten-home-equity-access-as-aid-measures-wind-down

@Scott Isbister @Steven Huang @Jacob Perez @Chris Baxter

Qualifying for a HELOC may not be the slam-dunk you expect it to be, and even if it was, HELOCs aren't a guaranteed source of home equity liquidity. Accessing property wealth has, and will continue to be, an important component of later in life financial planning. There are home equity financing alternatives beyond selling your home and HELOCs.

https://business.financialpost.com/real-estate/mortgages/canadian-banks-expected-to-tighten-home-equity-access-as-aid-measures-wind-down

@Scott Isbister@Steven Huang@Jacob Perez @Chris Baxter

Scott, I hope you managed to refinance before the lockdown. 

In the wake of the COVID-19 pandemic’s impact on our economy, all forms of mortgage financing have been increasingly more challenging the past several weeks. Refinances are uninsurable, so the lending risk sits squarely with the lenders; whereas purchase transactions facilitate changes of ownership, and the associated mortgages are a necessary and essential part of that process. Mortgage refinances are arguably a non-essential process. 

As a result of COVID-19, there are three main reasons why mortgage refinances have become much tougher for Canadians:

• More Stringent Scrutiny of borrower’s income and employment
• Lower appraisal valuations than expected
• Lender cutbacks in maximum LTV ratio.
• Lenders are asking for 3 to 6 months bank deposits to confirm rent revenue.

New guidelines change on April 8, 2020: a big bank no longer allow borrowers to borrow their down payment off a HELOC if the property being financed is a non-owner-occupied rental property. Various other lenders will no doubt do the same.

Can we expect more changes to lending guidelines?

@Ryan Valdes Welcome to the world of real estate and ownership. It sounds to me that you are looking for a term longer than 5 years? I'm curious, what's your reason behind this?

@Conor Kelly Lenders on the A side allow a borrowed source of down payment from a secured loc for a rental mortgage. Some B lenders accept borrowed down payment from an unsecured source.  Income to debt service ratios must be in line with lender's guidelines.

@Conor Kelly The source of down payment for a rental mortgage can be either own savings or from borrowed sources such as a secured or unsecured line of credit. If it is a borrowed source, the payment will be used in the GDS/TDS calculations. Does this make sense?