John Antle | Mortgages Beyond The Bank

Your Kelowna Mortgage Broker

If you are a Canadian citizen, financing a new home purchase is a fairly simple process and can be accomplished in most cases with a minimum of 5% down payment. For borrowers that are new to Canada, and are not yet citizens of the country, the process is slightly more complex.

There are some main factors that will determine what type of mortgage you will be approved for as a new resident of Canada:

1. Amount of down payment
2. Credit history in Canada
3. Residency status

Product FAQs

If I am a permanent resident, am I able to be approved for a mortgage?

Yes, this is the best scenario. If you are a permanent resident, have a good credit score and have a cash down payment of 5% of the purchase price you would qualify to purchase a property with a mortgage the same as a Canadian citizen.

Would I be approved for a mortgage if I am not a permanent resident?

If you are not a permanent resident, there may be a requirement for a larger down payment for final approval to be granted. (generally 10% of the purchase price) If you have a valid work permit, and have applied with the Government of Canada for permanent residency status,  approval for a mortgage with as little as  5% of the purchase price as down payment funds is possible.

Will Canada consider my credit history from another country to approve a mortgage if I am New to Canada?

Sometimes people will supply a letter of credit from their existing bank in their home country to be considered for a mortgage approval.  There are other ways to confirm credit history from non-traditional sources as follows:

  1. Payment of rent for a minimum of one year.
  2. Regular savings in a bank account for minimum of one year
  3. CMHC (Canada Mortgage and Housing Corporation) will also consider proof of at least 3 payments of other debt for minimum of one year (for example: utility bill or insurance)

Are there other ways that I can prove my credit worthiness to be approved for a mortgage if I am New to Canada?

There are other tasks you can complete to confirm your credit worthiness such as:

  1. Prove consistent payments of bills (rent, utilities, cable, insurance)
  2. Regular use of a bank account in Canada
  3. Apply for a credit card
  4. Purchase and finance a vehicle
  5. Long term employment with the same company

Will I receive the same interest rate as others if I am New to Canada?

Yes, interest rates and terms offered by lenders are the same for persons New to Canada or for Canadian citizens.

If I have a large down payment does that make things easier for a lender to approve my mortgage?

Yes, remember that if you have a minimum of 20% of the purchase price available for a down payment, you only are approved by the lender, and CMHC default insurance is not required.

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