Canada Mortgage and Housing an Understanding to High ratio mortgages

Insured mortgage loans are available to cover the purchase price of a home as well as an amount to pay for immediate major renovations or other improvements that the purchaser may wish to make to the property. This option eliminates the need to obtain secondary financing after the purchase to pay for improvements. The homebuyer obtains a single first mortgage, makes a single mortgage payment, and benefits from first mortgage interest rates. The insured loan will be based on the lower of:

The purchase price plus the actual cost of improvements, or,

The "as improved" market value.

Prior to approval, CMHC will determine the market value of the property after renovations/improvements. The lending value will not exceed the market value of the property after renovations/improvements.

Applicants must have the following:

A minimum of 5% down payment of total cost (purchase price plus renovations/improvements)

Cost estimates for renovations/improvements

Borrowers are required to demonstrate, at the time of application, their ability to cover closing costs equal to at least 1.5% of the purchase price.

Where the minimum equity requirement is being met by way of a financial gift, the funds must be in possession of the borrower 15 days before making an offer to purchase.

Do you qualify? Ask us

Tel. Mississauga, Oakville 905-567-7743 - Toronto, Vaughan and Surrounding areas 416-987-7743

Member of Toronto Real Estate Board, Ontario Real Estate Association and Canadian Real Estate Association

All information subject to change without notice .Copyright � 1996-2009 CHRITON Company Inc. Realty Services

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