Effective October 15 2008, the federal government implemented new mortgage criteria. Impact is minimal, only affecting individuals obtaining a mortgage with a down payment of less than 20 per cent from a federally regulated lender. The first change is the maximum amortization period being reduced from 40 to 35 years. The second change is the minimum down payment is now five per cent, eliminating the no down payment program.
This is good news because the higher amortization periods may mean slightly lower monthly payments but results in higher interest payments in the long run.
The no down payment option has been eliminated from federally regulated lenders, however some lenders have some creative solutions to help customers. The program will lend you 95% and give you the extra 5% for free. What’s the catch? Well as you can guess, nothing is free. Basically the 5% is rolled into the higher interest rate you would pay. I think it is a good program for the ones that really need it.
Contact me and I can help refer you to experienced mortgage brokers that can solve your financial needs.
Canada’s central bank cut its benchmark interest rate to its lowest level on record to 1%. As a buyer, this is the golden opportunity you have been waiting for. Low real estate prices with the addition of low interest rates. You can not lose with this combination investing long term in real estate. Grasp this opportunity, contact me and let’s look for some good deals.
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