• This past weekend, I took part in the “Newcomers To Canada” show at the Sheraton Hotel downtown Toronto.  I met many people from countries all over the world, such as China, India and Jamaica to name a few.

    ID-100186061-1Some people had been here more than 1 year and some had only just landed.  They all wanted to have better lives in Canada, then where they immigrated from.

    It reminded me of my famiy’s situation 42 years ago. We were also immigrants from Uganda and we came with nothing – not even winter coats.  We landed in Montreal’s Red Cross Society and were sent to live in St. Catherines with family.  Life back then was not as difficult as it is now and buying a home back then was not as expensive as it is now.

    Based on my own experience as an immigrant, I thought it would be helpful to provide some advice to newcomers on how to best navigate the mortgage minefield.

    The first tip is to speak to a mortgage agent/broker.  We have a plethora of lenders (including the banks) in our tool box and can get you the best mortgage that works for you, without selling you add-ons that you can’t afford or don’t need.

    Depending on your employment history in your home country and in Canada, and immigration status, you will have different requirements for the downpayment.

    If you have at least two years employment history, and if you can afford to put down at least 20% of the purchase price, you may qualify for a “conventional” mortgage.  The benefit is that you don’t have to pay default insurance of 1-3% on top of the mortgage amount, and you can get lower rates as well as flexible payment terms.

    If you have less than 20%, you can still qualify for a mortgage, but it will require mortgage default insurance.

    Perhaps you a newcomer with less than two years experience?  Do you have a substantial down payment of 35% or more?  Many people I spoke to this weekend, had amassed savings back home and were able to transfer that money to Canada (following the Canadian CRA guidelines) to use as their downpayment on their Canadian home.  Don’t know how? – a mortgage agent/broker can assist you with that!

    Sometimes you don’t yet have proven income but have a substantial downpayment.  A mortgage can still be had by answering questions regarding your financial history (backup may be needed) and proof of permanent residency status.

    Of course, even after 3 months of permanent employment and not having a large downpayment, you can still qualify.  Here are some things you should be aware of:

    • You must have immigrated to Canada within the past 24 months
    • You must have landed immigrant status and have applied for permanent resident status
    • You must have a minimum of three months’ full time employment in Canada
    • All debts held outside of Canada must be included in determining how much you can afford, or your total debt servicing ratio – this applies to people who are sending money back home to family
    • You’ll require a letter of reference from a recognized financial institution
    • The mortgage would have to be default insured

    Rent to Own

    Another option that is available to those who don’t have a downpayment is to do a Rent-to-Own.  This will be another article, however here is some useful info to read:


    Coming to a new country like Canada isn’t always easy, however seeking the right advice for you and your family is easy, when you know where to turn.

    A mortgage agent/broker does not only help get you a mortgage, but can also do the following for you:

    • If you don’t have a downpayment and need a plan for amassing a downpayment we can help put a budget together for you
    • We can help you look at all of your options – ie. buying, renting, rent-to-own, etc.
    • We can help you build your own power team – ie. real estate professional that will help you find your dream home in your budget; a lawyer that will work with you every step of the way; an accountant if one is needed and more
    • Finally, we can help you navigate the property investment arena if you have extra money that you want to invest

    By following the right advice, you too can be a newcomer who becomes a new-homeowner in Canada.

    To your Wealth!