Permanent Residents and Non-Permanent Residents

Newcomers to Canada play an increasing role in Canada’s future population growth, creating new market opportunities. Insured financing is available to borrowers with permanent and non‐permanent residence status, helping newcomers to realize their dream of home ownership in Canada.

Newcomers with permanent residence status can purchase a home with as little as 5% down payment. For non‐permanent residents, we will require a minimum of 10% down payment. We offer competitive Interest Rates and no set maximum loan amount.

Features

For permanent residents, where there is limited Canadian credit history and where foreign credit bureaus are not available, we will consider the use of alternative sources of payment history. No additional fees or premiums as a result of residency status ‐ standard product specific premiums apply. No minimum period of residency required.

Borrower qualification

Borrower must have immigrated or relocated to Canada within the last 36 months. You must have a minimum of 3 months full time employment in Canada (borrowers being transferred under a corporate relocation program are exempt). You must have a valid work permit or obtained landed immigrant status. For 95% LTV, down payment must be from own resources. For LTV’s less than 95%, the remainder may be gifted from an immediate family member or from a corporate subsidy. All debts held outside of the country must be included in the total debt servicing ratio (Rental income earned outside of Canada is to be excluded from the GDS/TDS calculation). Standard insurance premiums apply.

Relaxed Credit Qualification

If you are not established with a Canadian Credit Bureau, alternative forms of credit may be allowed such as payment of rent or room and board, plus one additional obligation or documented regular savings, for the preceding 12 months. If confirmation of rent payments is not available, payment over the preceding 12 month period of any three regular periodic obligations such as: Payment of utilities, cable, childcare expenses, insurance premiums, documented regular savings etc. Call you broker for more details.

Non-Resident Investors in Canada

No Buying Restrictions

There are no restrictions for a non-resident to purchase real estate in Canada, nor are there tax implications or extra fees payable at time of purchase. A non-resident may purchase as many properties as they wish in Canada. If a non-resident purchases a rental property they must file a Canadian tax return each year and declare the rental income.

Do non-residents qualify for a Canadian mortgage?

  • For non-resident borrowers lenders generally require a minimum of 35% – 50% down payment. Qualifying for the mortgage financing is probably no more rigorous than what borrowers in other countries are accustomed to.
  • The borrowers will be interviewed via phone, fax and/or email to gather personal information including, assets/liabilities, employment and/or income information. Each borrower’s application will be considered on a case by case basis.
  • The mortgage approval may take approximately 24 to 48 hours after application and documentation have been submitted to the lender.
  • Documentation generally required: Income verification, tax returns, credit bureau or banker’s report (letter from their own bank stating that all accounts are in good standing to date), down payment confirmation via bank statements, copy of 2 pieces of identification, one must be photo and real estate appraisal.
  • The borrower will need to open a Canadian bank account for debiting of mortgage payments.
  • The borrower will require the services of a Canadian lawyer or notary public to prepare the mortgage documents and registration at the Land Titles Office. It is best if the borrower is available in Canada to sign mortgage documents at the time of completion. In the event the documents need to be couriered outside of Canada for signing, this will need to be arranged with the lawyer and lender well in advance of completion date.

What happens when a non-resident sells real estate in Canada?

  • Whenever a non-resident sells Canadian real estate, the non-resident is required to pay the appropriate amount of taxes on any gain. The non-resident vendor must provide to the purchaser, on or before closing, a clearance certificate from Canada Customs & Revenue Agency. This certificate certifies the amount of money that is payable for taxes. The amount owing is deducted from the sale proceeds and sent directly to the federal government by the vendor’s lawyer.
  • This certificate may be applied for in advance of the completion date by the vendor, but not until there has been a contract of purchase and sale with all subjects removed. The wait for the certificate is usually 6-8 weeks.
  • If the certificate is not obtained, the purchaser is required to hold back from the sale proceeds a percentage of the selling price (usually 25% – 50%).