Down payment and Amortization Confusion!

Okay...here are the basic rules:

Down payment

When you purchase a home for your own residence, you need a minimum down payment of 5%.

When you purchase a revenue property to rent out, you need a minimum down payment of 20%.

This is not changing.

Refinancing

Before March 17, 2011, if you are refinancing a property you already own and live in, you can borrow a maximum of 90% of the market value of the property.

After March 17, 2011, you can borrow a maximum of 85% of the value of the property.

Amortization

Before March 17, 2011, the maximum amortization on a high ratio mortgage (less than 20% down payment) is 35 years.

After March 17. 2011, the maximum amortization on a high ratio mortgage is 30 years.

It is still possible to arrange amortization periods up to 40 years on conventional mortgages (more than 20% down or 20% in equity)

If you have any questions, do not hesitate to call me at 250.475.1166 or

send me an email 

Apple a Day financial

Are you worried about your family's financial future? Join Certified Financial Planner Alexandra (Alyx) Gilgunn at Mothering Touch Resource Centre March 9th for a hands-on interactive workshop designed to get your family finances on track. We will be looking at strategies to pay down debt, how much your family will need for your child's first few years, ways to save and how to protect your family with insurance. Register directly through Mothering Touch at 595.4905. $5, Wednesday March 9th, 2011. 5:30-7pm.  

Maximum

20 participants.   

Mortgage and Real Estate Updates

Visit MY BLOG 

 'Window closing' on ultra-low mortgage rates

Financial Post

Amid the noise of volatile-but-improving economic indicators, mortgage rate hikes are likely to repeat like a chorus in the coming months.

Canadian banks are raising interest rates on mortgages, marking the beginning of a trend as they correlate with rising bond yields and expected monetary tightening.

That's making a strong case for borrowers to lock into fixed rates before it's too late, said Benjamin Tal, deputy chief economist with CIBC World Markets. "The window is closing."

TD Canada Trust and CIBC both announced Monday hikes to their residential mortgage rates, the first increases since changes to the rules of borrowing were announced by the federal government last month. The other big banks where expected to follow the moves shortly.