Unlike residential mortgages, which for the most part, have solid subjective requirements and structures for financing, the commercial financing requirements vary and are considered on a case by case basis. When it comes to residential lending, most of the criteria falls on the borrowers, where as with the commercial market, a bulk of the criteria which needs to be met falls on the property itself.
Did you know that not all “A” products offered by major banks are the “ace products?” So if you’re looking for a mortgage getting one from schedule A lenders shouldn’t be your priority. After the introduction of B20 in 2011, and later the stress test rules in 2018, the mortgage industry has become more complicated than ever. A few years ago, we used to have straight-forward, limited options. But these days, even with the schedule A lenders such as charter banks, you might find various features or offers on the same product from different lenders.
Whether it’s our work schedule or social life, there is no denying that COVID-19 has turned our lives upside down. However, that doesn’t mean that you should stop planning for a prosperous future for you and your family, especially when it comes to purchasing a home.
If your down-payment comes from your own savings, ensure that the source of all large deposits is trackable and tracible. According to the Anti-Money Laundering Act, all lenders in Canada are obliged to make an enquiry and do their due diligence to ensure that the source of down-payment is legitimate and clear. As a rule of thumb, they would ask you to provide a minimum three-month history from your savings account. If there is any large deposit into your account during that period, be prepared to provide some additional documentation to prove the source of it.
Securing a mortgage is getting increasingly challenging, which makes it best to hire a professional that can guide you through the entire process of applying for a pre-approval to collecting the house keys.
Regardless of whether you have set “financial improvement” as one of your resolutions for 2020 or not, it is vital to understand that everyone faces financial challenges from time to time. To overcome economic hardships that could force you to live from paycheck to paycheck or accumulate heaps of debt, it is vital to watch your cash flow and improve how you utilize your money.
When you consult with a mortgage broker, irrespective of your financial situation and credit score, they are likely to have a lender that is willing to work with you. A mortgage broker can do this because of the extensive network of lenders they have built and the knowledge they have acquired about each type of lender.