Questions re: securing a mortgage

[srg83]

I'm not at this point yet, but I hope to be by at least the Spring (or later).

Anyway the question is this; first, is it even possible anymore to secure a mortgage with $0 down? I'm asking this because of the recent economic conditions, etc.

Second question is related to the first. Would it be easier to secure a mortgage with $0 if my intention was to get, say, a 3-bedroom home and rent out two of the bedrooms? So then the mortgage payments would come from four sources: my income, my girlfriend's income, and the other two bedrooms.

Finally, another question which again relates to the first two. My credit is a little on the poor side; I owe money on a few things. However if I show a mortgage broker that I have a solid plan to pay down debt (which I do), as in a written-out plan for the bank, as well as the 4 incomes to pay down the mortgage, would all that increase my chances of getting a mortgage (with $0 down ideally)?

The problem is, to be honest, I'm in a horrible position; a downpayment wouldn't be able to come for quite a few years, and I don't have enough in RRSPs for a first-time home buyer's withdrawl.

Thanks - this is all just for my information, I don't have anything lined up yet. But the more I know, the better off I am.

[zoober]

I'm not at this point yet, but I hope to be by at least the Spring (or later).

Anyway the question is this; first, is it even possible anymore to secure a mortgage with $0 down? I'm asking this because of the recent economic conditions, etc.

Second question is related to the first. Would it be easier to secure a mortgage with $0 if my intention was to get, say, a 3-bedroom home and rent out two of the bedrooms? So then the mortgage payments would come from four sources: my income, my girlfriend's income, and the other two bedrooms.

Finally, another question which again relates to the first two. My credit is a little on the poor side; I owe money on a few things. However if I show a mortgage broker that I have a solid plan to pay down debt (which I do), as in a written-out plan for the bank, as well as the 4 incomes to pay down the mortgage, would all that increase my chances of getting a mortgage (with $0 down ideally)?

The problem is, to be honest, I'm in a horrible position; a downpayment wouldn't be able to come for quite a few years, and I don't have enough in RRSPs for a first-time home buyer's withdrawl.

Thanks - this is all just for my information, I don't have anything lined up yet. But the more I know, the better off I am.


You're in a "horrible position" financially and cannot scrape together a downpayment yet you want to buy a house? Are you trying to make a career change to landlord or something?

[srg83]

Perhaps horrible was a strong word for my situation.

Basically I am living at home at the moment to pay off debts and save; however that amount of money I'm saving won't be good for a downpayment for a few years (and I'm sure you could understand not wanting to live at home for ~3 more years). I'd rather buy than rent.

Just for the record, I could do without people's value judgements, considering I am just asking for information. If I wanted that I would go and make up a post about getting a speeding ticket in the car section.

[furtado_4real]

I agree with you. I see post after post where people talk down, insult etc... a persons financial situation or choices. Is this to make one feel better about themselves? I am not certain.

Sr - try to buy the house - don't listen to others. If the bank will cover you, then go for it. Trust me, most people who talk Sh-t don't have much themselves (except the B.S they spew on the internet).

Good luck!

[brunes]

When I bought my house 5 years ago, I did not have anything down. I was CMHC insured and I put the down payment on my LOC.

I don't regret it. Sure it may have "cost" me 4-5 rand in CMHC fees and some interest, but I am much happier in my own home than I ever was in an apt.

[srg83]

When I bought my house 5 years ago, I did not have anything down. I was CMHC insured and I put the down payment on my LOC.

I don't regret it. Sure it may have "cost" me 4-5 rand in CMHC fees and some interest, but I am much happier in my own home than I ever was in an apt.

The CMHC is something I've been looking into but don't quite understand. So what you did was borrow a down payment from a LOC? Or you paid interest and other fees with the LOC in order to have no down payment?

One of my plans to get rid of the debt I have is to get a loan to pay off everything - preferably a LOC - so perhaps this is the way to go?

[CSK'sMom]

Start reading on the CMHC site as well as several banks and real estate buying guides. CHMC discontinued 0 down and 40 yr amortization mortgages in the fall. You can borrow your downpayment but there are specific rules surrounding it and you still have to meet all the ratio numbers to qualify...

[squid]

Using rent in your figures usually requires verifiable figures from a lease or rental agreement.

Also, talking about your financial situation is relevant. A lender will be looking at your credit/payment history, level of savings, etc. in order to assess you.

You say you have been staying at home to save, but then say you have no down payment saved. Sketchy, and makes you a poor prospect IMO.

[srg83]

Using rent in your figures usually requires verifiable figures from a lease or rental agreement.

Also, talking about your financial situation is relevant. A lender will be looking at your credit/payment history, level of savings, etc. in order to assess you.

You say you have been staying at home to save, but then say you have no down payment saved. Sketchy, and makes you a poor prospect IMO.

I've only been back since August...and I said pay off debt AND save. Without getting into specifics, it is difficult to save for a significant down payment in only 4-5 months starting with a total under $100.

[jheath]

I'm not at this point yet, but I hope to be by at least the Spring (or later).

Anyway the question is this; first, is it even possible anymore to secure a mortgage with $0 down? I'm asking this because of the recent economic conditions, etc.

Second question is related to the first. Would it be easier to secure a mortgage with $0 if my intention was to get, say, a 3-bedroom home and rent out two of the bedrooms? So then the mortgage payments would come from four sources: my income, my girlfriend's income, and the other two bedrooms.

Finally, another question which again relates to the first two. My credit is a little on the poor side; I owe money on a few things. However if I show a mortgage broker that I have a solid plan to pay down debt (which I do), as in a written-out plan for the bank, as well as the 4 incomes to pay down the mortgage, would all that increase my chances of getting a mortgage (with $0 down ideally)?

The problem is, to be honest, I'm in a horrible position; a downpayment wouldn't be able to come for quite a few years, and I don't have enough in RRSPs for a first-time home buyer's withdrawl.

Thanks - this is all just for my information, I don't have anything lined up yet. But the more I know, the better off I am.

Q1 - Yes it is, but it requires a borrowed downpayment from another institution or through the lender. Your CMHC/GW/AIG premium will be slightly higher. The lender will charge you a higher interest rate if you receive the d/p cashback, usually 1.5-2% higher and min. 5 year term. It is also possible to get 100% financing subprime, however rates are signicantly higher. Either of these have min beacon / fico score requirements of at least 640. If you're below that, you're out of luck.

Q2 - Roommates paying you rent will have zero effect on you being able to get a mortgage or qualify for more money. Rental income will only be considered if the property has more than one legal unit (duplex, triplex, legal accessory apt). If your girlfriend and / or others planning on living in the house purchase it with you, then it will be decided by looking at all incomes / debts / credit, etc.

Q3 - Your plan won't help unless executed before you buy.

[srg83]

Q1 - Yes it is, but it requires a borrowed downpayment from another institution or through the lender. Your CMHC/GW/AIG premium will be slightly higher. The lender will charge you a higher interest rate if you receive the d/p cashback, usually 1.5-2% higher and min. 5 year term. It is also possible to get 100% financing subprime, however rates are signicantly higher. Either of these have min beacon / fico score requirements of at least 640. If you're below that, you're out of luck.

Q2 - Roommates paying you rent will have zero effect on you being able to get a mortgage or qualify for more money. Rental income will only be considered if the property has more than one legal unit (duplex, triplex, legal accessory apt). If your girlfriend and / or others planning on living in the house purchase it with you, then it will be decided by looking at all incomes / debts / credit, etc.

Q3 - Your plan won't help unless executed before you buy.

Thanks for the answers. Good to know for Q1; my score probably needs a little work but that's something I'm working on anyway. As far as the answer to Q3 is concerned, it is in effect right now.