Canada is essentially a nation of immigrants and as a result we at Mississauga-mortgage have special mortgage programs for new Canadians. Mississauga is a city of approximately 50% immigrants and it is much easier for new Canadians to get a mortgage than what you might think.

Here are some details of the New to Canada mortgage program:
1. Temporary residents are eligible to purchase a home in Mississauga (“9” SIN numbers)
2. Temporary residents must show proof that they have applied for permanent residency
3. A 5% down payment is required. In some cases 10% is the minimum down payment
4. Credit worthiness can be established from your Mississauga utility bill or from means other than a credit bureau.
5. A reference letter from the applicant’s bank from their country of origin might be required as well as a credit bureau from the country of origin.
6. Applicants that are internal company transfers from their country of origin to Canada are preferred.
7. Only applicants that have been in Canada for less or equal to 3 years qualify for the New to Canada program.
8. The applicant(s) income must be provable.
9. Refinances for applicants with “9” Sin numbers are possible only if the applicants have more than 20% equity in their homes.

Not all lenders offer the New to Canada mortgage programs. Jacques du Preez has gone through this transition himself and will be able to guide you through the process of purchasing a home in Canada.

Here are the meeting dates for the Bank of Canada for 2012. These dates are very important, especially for those with variable rate mortgages:
17 January
8 March
17 April
5 June
17 July
5 September
23 October
4 December
As usual there are always 8 meetings per year.

This is the first of a series of articles to educate self employed people about their mortgage options and to show them how we at Mississauga-mortgage.com can help them.

Some general comments:

Most self employed people do not know what their mortgage options are and what they need to do to prepare themselves for a mortgage.  As a result they leave themselves vulnerable to less than best products from their bank or mortgage broker.  Thus, it is vitally important that self employed applicants are empowered in the mortgage process.

It might sound unbelievable, but in some cases it is actually easier to get a mortgage for a self employed applicant than it is for an employed person.  This is because salaried or hourly paid applicants are restricted to the exact income that they earn.  Self employed applicants have more options, because of the nature of self employment.

Preparing yourself for a mortgage:
Here are a few things that you need to do

1. Contact Jacques du Preez at mississauga-mortgage so that we can do a full mortgage analysis for you.  This includes a mortgage pre-qualification.
2. Register your business.  Don’t just operate on a HST number.
3. Make sure that your business is more than two years old.
4. Make sure that your credit is good.  Good credit is more important than income for mortgage qualification.
5. Make sure your business is visible.  Here are a few ways that you can do this:
   a) Website
   b) LinkedIn
   c) Online directories such as 411.ca
   d) Facebook
   If lenders cannot find your business on the web they question the legitimacy of your income.
6. For a property purchase: have 10% down payment for a purchase and an additional 1.5% closing costs.  This must come from the applicant’s own resources.  It cannot be borrowed.
7. For a refinance: have at least 15% equity in your property
8. Make sure that your income taxes are paid up to date.

If you have not done all of the above for your business we can still get you a mortgage at competitive rates, but if the above is completed we can get you the best mortgage with the best rates and conditions.  At Mississauga-mortgage we specialize in mortgages for self employed applicants.

Mortgage rules are changing again.  The rules are essentially because the Minister of Finance believes Canadians have too much debt.  The Economist and I agree with this; Canadians have the highest public debt in the world!!  However, mortgage debt (secured debt) is far less of a problem than unsecured debt like credit cards, lines of credit etc.  Unsecured debt is very problematic and at least in the past people have been able to consolidate unsecured debt in their mortgages, however, with the new mortgage rules that will become more difficult as you will see below.

Here are the new mortgage rules that take effect on 18 March 2011:

1. Purchases: As in the past, only 5% down payment required.  This is applicable to all purchases; not just first time home owners
2. Refinances: The mortgage cannot be more than 85% of the value of the property. (Currently up to 90%)
3. Amortization: Maximum 30 years (Currently 35 years)

There are no qualification rules for unsecured debt; it is up to every bank to approve applicants or not.  Unless the government addresses this problem Canada’s debt problems will be left unattended.  I believe the new mortgage rules will increase personal bankruptcies in the near future.

Good news for Mississauga property owners and indeed for all Canadian property owners.  Here is some of the benefits from the 2009 federal budget:

1. A $5,000 increase to the RRSP Home Buyers Plan.  This means first time home owners can now withdraw up to $25,000 from their RRSPs for a down payment; tax and interest free.
2. A $750 tax credit for first-time home buyers to help with closing costs, such as legal fees, disbursements and land transfer taxes.
3. A 15% tax credit of up to $1,350 on eligible home renovation expenses undertaken before 1 February 2010.
4. $300 million for Eco energy retrofit grants.
5. More “disclosures” for mortgage insurance designed to help consumers better understand the mortgage insurance transaction.

To get the full details please speak to your accountant or real estate solicitor.