New immigrant mortgages

Are you new to Canada? Did you believe that you would have to wait years to build up credit before you could buy a home?  Think again! New immigrant mortgages are the kind of mortgages for people that have moved to Canada. Eligibility for the mortgage typically lasts 5 years from the date that you have obtained permanent residence.

What is beneficial about a new immigrant mortgage?

The benefits of the new immigrant mortgage depend on the type of mortgage being arranged.  Broadly speaking, there are two types of new immigrant mortgage:

  • Insured new immigrant mortgages, where you have less than 35% down-payment.
  • Uninsured new immigrant mortgages, where you have 35% or more down-payment.

Insured mortgages are mortgages that have mortgage default insurance attached to them, which allows the lender to reduce their risk on the loan. For the insured mortgages, the main benefit of the new immigrant mortgage is that it is acceptable to have new and unestablished credit and still qualify for a mortgage.  However, income and debt servicing requirements remain the same as a regular mortgage.

For uninsured mortgages, lender policies have become increasingly restrictive in the last 2 years.  Some mortgage lenders would not require any income or credit verification and would still lend to new immigrants.  However, mortgage lenders will require some kind of verification of income, whether it be in Canada or possibly from outside of Canada.  The requirements for established credit are also easier on uninsured mortgages similar to insured mortgages.  There is also often more flexibility to uninsured mortgages in general, such as extended amortization terms, that can help make it a little easier to qualify for.

One thing that I should note, is that if you have been in Canada for a few years and have made some mistakes with your credit management, that can hinder your approval for prime financing.  However, depending on your individual circumstances, we may still have options that can help you.

How do I find out if I am eligible for a new immigrant mortgage?

This article is not meant to teach you a great deal of specifics about what new immigrant mortgages are, or to enable you to self-qualify for one.  What this article is for is to just let you know that it is possible, that you may not have to wait longer to buy a home if you don’t wish to.  I work with all kinds of clients including new immigrants, and can help you determine how we can best help you to get into your own home.  Please contact me to discuss your personal circumstances.  Usually within a 5 minute conversation, I can determine if it is worthwhile to proceed further with an application, or alternatively I can give advice which may help you in preparing to buy your home.