•

Getting A Mortgage In Canada

Most arrivals from the UK should find little difficulty arranging a mortgage with a reputable bank in Canada provided they arrive in Canada with:

A verifiable, clean credit history from a reputable lender in the UK; and:
Permanent residence; and:
Enough money to fund at least 35 percent of a house purchase.

You will not need a job. If you already have a job in Canada, the need for a 35 percent deposit will be waved.

Some lenders may offer more relaxed terms than those above, but they are likely to charge you an above-average interest rate.

Tell Me More About Mortgages In Canada

As a newcomer to Canada, you will have no Canadian credit history. Most lenders will be reluctant to offer you as good a deal as they would offer to Canadians with clean credit histories. You will get a better deal if you can providing references from a reputable UK lender showing that you have been a reliable mortgage customer.
The weaker your link to Canada, the more of your own money will be required to fund a purchase. Many lenders ask new arrivals to Canada to fund 35 percent of a purchase with their own funds, with the bank providing the other 65 percent as a mortgage.
If you don't have a job in Canada, or if you are in Canada on a work permit rather than with permanent residence, some lenders will offer you a mortgage. They may require that you keep one year's worth of mortgage payments in a bank account to cover them while you look for work / apply for permanent residence.
If you are in Canada on a work permit, it is seen as favourable if you have applied for permanent residence - with a positive outcome likely.
The standard Canadian mortgage requires the buyer to fund at least 25 percent of the house purchase. The mortgage covers the other 75 percent.
Banks will fund greater than 75 percent of a property's value if the borrower is willing to pay for indemnity insurance, to insure the mortgage against default.
Banks offer mortgages of up to around three times annual gross income to people who earn average incomes. If you have a higher income, higher multilpes - around 3.75 annual income - may be available.

How Could I Get Better Terms On My Mortgage?

There are two main routes to getting a mortgage in Canada. You can either deal directly with the banks yourself, or you can use a mortgage broker:

Most mortgage brokers are independent advisors. Their aim is to find the best mortgage available for you, given your circumstances.
They have access to a wide variety of lenders.
They are paid by the lender rather than by you.
Many migrants have found brokers were able to obtain better rates of interest or negotiate larger percentage mortgages than they were able to obtain themselves.
Mortgages are available as follows from Canada's high street banks:
Mortgages from the Canadian arms of British banks, such as HSBC Canada Mortgages, are also worth considering as sources of mortgage funding in Canada.

An Open Mortgage or a Closed Mortgage?

Mortgages in Canada can be open or closed:

Open mortgages can be paid off or re-negotiated at any time without additional interest.
Closed mortgages cannot be paid off early unless the borrower is willing to pay additional interest.
Some lenders may allow limited early repayment without penalties.
Closed mortgage interest rates are usually considerably lower than open mortgage rates.