Home Ownership Mortgage Solutions
Home Ownership Solutions – Guarantor Income Program:
With the current B20 lending rules it has become very difficult for first time home buyers and single income families to be able to qualify for a mortgage to purchase a home. This created a massive affordability gap, and has put home ownership out of reach or on hold for a lot of future home owners.
Ways to work around this:
Joint business ventures.
Purchase your home with a like-minded individual with joint ownership and both applications on the mortgage. There are risks and inconveniences. Definitely not the right fit for everyone. There are ways to mitigate the risk. And not all lenders consider this.
Increasing your downpayment to 20%.
Either through savings or gifted from immediate family members. Not everyone has this option. Only a select few credit unions still allow approval under traditional non B20 lending rules using the committed rate to qualify you, as opposed to the BOC benchmark rate.
RTO Rent to Own solution
Much needs to be discussed and reviewed about this option for consideration. Especially pro’s and con’s and risk to the tenant with the future buy option. Not a good fit for everyone, and also not recommended for everyone.
A financially strong immediate family member willing to co-sign on the mortgage with you, and be on title to the property also to help you qualify. Their income is needed and used to help you qualify in your capacity. There are ways to mitigate their exposure to capital gain, help you qualify for the maximum LTTR, and also reduce future land transfer taxes when we remove them off mortgage and title at maturity.
Traditionally, the definition of a guarantor is an immediate family member guaranteeing the mortgage and is not on title of the property. No income is used, only to strengthen the covenant, not capacity to help qualify the mortgage. If income is needed then the family can be a co-signer instead.
We have a very progressive and competitive lender who just came out with a new mortgage lending product that will allow us to use your guarantors income to help you qualify your capacity for the mortgage also, and your guarantor is not required to be on title to your property. This is a massive game changer for future home owners who have been placed at a disadvantage due to the new lending rules, and who have an immediate family member willing to help who do not wish to be on title. It is a brand new product, and we anticipate that in time more lenders will jump on this.
Reach out to us if you have any questions or need more information to see how all options for home ownership, and especially the new guarantor income program works and can benefit you. Always a pleasure and privilege to be at your service.
We look forward to hearing from you! www.iMortgageBroker.ca