On October 15, 2008, the Federal Government’s new lending rules came into effect which phased out zero down payment mortgages.
The minimum down payment required is 5% of the purchase price.
BUT…
For those who have not saved the 5%, you have two other options:
(1) Borrow the downpayment;
(2) Obtain a cashback for the downpayment.
Borrowed downpayment
You can borrow the down payment.
You may already have an existing line of credit or some other source of short term financing.
Under this Cash Back program, we secure a mortgage which provides the 5% down payment needed for the purchase.
The cashback goes towards the downpayment on the home. In exchange for gifting you the 5% down payment, the interest rate on the mortgage is usually a posted rate.
As with the borrowed downpayment, you will need to have good credit, stable income and you must intend to live in the property.
Benefits of Borrowed or Cashback Mortgages
Borrowed / Cashback mortgages allow a borrower who may be currently renting to get into the market when otherwise they would have to wait several years to accumulate the money for a down payment. You can therefore achieve your dream now rather than wait a few years and potentially benefit from increasing real estate prices.
Secondly, this approach may allow the borrower to pay down other high interest debts. Instead of using your down payment for your purchase, it may be wise to apply the down payment against your credit card bills which are costing you more. Thus lowering your debt service ratio.
Third, you may not have the money to purchase the furniture you need for your home. Most people use their credit cards or line of credit for this purpose.
PS - Side note options
Vendor/Owner financing by way of a take back/2nd mortgage
RRSP ($25,000 limit per person)
Possible tax refund from strategic planning
Now that you have various good options for buying a home with little or no money down, where is the best place to begin?The first step is taking advantage of our free HomeLoanFinder service at https://www.notapennydown.com/find.htm – it will identify (from hundreds of programs) the very best home loans for YOUR needs and preferences…including
Zero Down Payment Programs
Low Monthly Payments
Low Interest rate home loans
Accelerated home loans you can pay off quickly
We`ll do more than help you get financed!
Financing is only the first step in the home buying process.
We are dedicated to helping you through the entire process, delivering world-class service all along the way.
We´ll refer you to the right Real Estate Consultant who will help you find the right home, negotiate the right terms, and then make sure that you actually get to the closing table.
It`s all part of our Preferred Buyer`s Program, which you can join for FREE! That`s right, it won`t cost you a dime!
If you`d like to know more about your financing options and would like to be part of our Preferred Buyer`s Program, just email…or call me today.
I look forward to helping you.
604-273-2002
Take care,
Mark Fidgett
“Your Personal Mortgage Consultant….For Life!”
PS - Please Don’t Keep Me a Secret
A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!
T 604.273.2002 | F 604.522.2072
W http://www.notapennydown.com
An independent Mortgage Specialist associated with the Verico Mortgage Network.
