Real Estate

Wow.. 10% non resident mortgages under 25 years of age

  • Last Updated:
  • Feb 9th, 2018 8:26 am
35 replies
Deal Guru
Feb 9, 2009
12344 posts
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Thats good... they got money. We need more of these foreigners here! Rather them, then some obnoxious kid who drives an Uber and thinks he deserves to live in a detached house.
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Oct 13, 2008
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Well ... just recently one of our client's closed a purchase on a $8 Million home ... the mortgage was $4 Million ... purchaser was 19 years old ... guarantors none other than his father ....

Monthly mortgage payment ... $21000 ... WOW!

They have money ... who cares!
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Deal Guru
Feb 9, 2009
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AV-Fishing wrote: Well ... just recently one of our client's closed a purchase on a $8 Million home ... the mortgage was $4 Million ... purchaser was 19 years old ... guarantors none other than his father ....

Monthly mortgage payment ... $21000 ... WOW!

They have money ... who cares!
Beyonce and Jay-Z have a $52 million dollar mortgage with $149,000 monthly mortgage payment... they can afford it...lots and lots and lots of money and wealth in this world...
Last edited by Sanyo on Feb 6th, 2018 10:40 pm, edited 3 times in total.
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Oct 13, 2008
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Sanyo wrote: Beyonce and Jay-Z have a $52 million dollar mortgage with $149,000 monthly mortgage payment... they can afford it...lots and lots and lots of money and wealth in this world...
Those are celebrities ... different world ... different class.

If you're going that route .. then mind as well say how many properties Trump has ... what about Zuckerberg or Gates ...

You gotta look at the "normal" Joe ... not ones that are in the news all the time.
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Deal Guru
Feb 22, 2011
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Toronto
Doesn't surprise me. I know a lot of people who came here as students and worked extremely hard and got good degrees in tech, medical or engineering fields. Takes awhile to get PR but some still buy.

Then you get people with a gr 10 education wondering why they cant afford a house.
Deal Guru
Dec 11, 2008
10626 posts
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Garth Turner would probably not address this since he doesn't believe foreigners play a significant role.

And that is just for those who need mortgages...
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Nov 2, 2013
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Edmonton, AB
Some lenders through mortgage brokers have a "stated income" program, where the formal income verification requirements are scrapped with a >=10% downpayment. Instead you specify what industry you work in and the lender draws an income based on average/median statistics.

If the investors are OK with taking on the risk, then so be it.
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Deal Fanatic
Oct 7, 2007
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If you legally and honestly earn the money you are spending, you will be a responsible consumer and contributor to society. In other words, your money is earned through hard work or legitimate business practices as opposed to illegal activities including tax evasion. Any other situation is not just bad for the society who welcomes this person but also disastrous for the individual.
Newbie
Feb 2, 2018
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AV-Fishing wrote: Well ... just recently one of our client's closed a purchase on a $8 Million home ... the mortgage was $4 Million ... purchaser was 19 years old ... guarantors none other than his father ....

Monthly mortgage payment ... $21000 ... WOW!

They have money ... who cares!
Just curious, was your client of Asian descent?
Deal Addict
Jan 20, 2016
2028 posts
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Houston, TX
FirstGear wrote: Some lenders through mortgage brokers have a "stated income" program, where the formal income verification requirements are scrapped with a >=10% downpayment. Instead you specify what industry you work in and the lender draws an income based on average/median statistics.

If the investors are OK with taking on the risk, then so be it.

AFAIK it's 35%. With almost 40% "downpayment" TD bank was quite due diligent in verifying my income. I was not buying a 8M home however :)
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Nov 2, 2013
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asa1973 wrote: AFAIK it's 35%. With almost 40% "downpayment" TD bank was quite due diligent in verifying my income. I was not buying a 8M home however :)
There is that program too, but it's a different program; not the "Stated Income" one. Stated Income basically takes your word for it and then compares your number to that typically found in your industry, as long as you can provide >=10% downpayment.

Yours sounds like CIBC's New Immigrant program... basically, there is no formal income requirement if you have >=35% downpayment/equity. The lender somewhat pretends you already own the house outright, then extends you a HELOC that you "spent". Lender then just cares you fork out the payments somehow. If you do not, then lender will happily take your home, take a chunk out of your downpayment/equity, and sell it...
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Deal Addict
Jan 20, 2016
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Houston, TX
FirstGear wrote: There is that program too, but it's a different program; not the "Stated Income" one. Stated Income basically takes your word for it and then compares your number to that typically found in your industry, as long as you can provide >=10% downpayment.

Yours sounds like CIBC's New Immigrant program... basically, there is no formal income requirement if you have >=35% downpayment/equity. The lender somewhat pretends you already own the house outright, then extends you a HELOC that you "spent". Lender then just cares you fork out the payments somehow. If you do not, then lender will happily take your home, take a chunk out of your downpayment/equity, and sell it...
I know, in Canada it's used to take what you said as true statement :) But hardly it SO used in finances...Either I used "wrong" lenders, or I lack some techniques, but nobody just believe I have an income, they want a PROOF of it. With much more then 10% of equity.

P.s. there is an old Soviet-era joke, about person from USSR went to some western country (it was UK , but really you can put Canada or US here). He went to it almost broke and returned as millionaire. His friend asking him how this was possible?
"I went to play poker. And could you imagine, they BELIEVE your words about which cards you have. And here's came my luck..."

P.s.s. And it's DO 35% DP needed for stated income mortgage (and this is NOT for newcomers as it requires 3 years credit history)
https://mymortgage.ca/loan-programs/75- ... ogram.html
Clients who have difficulty proving their true income can qualify based on 35% down. These are clients who are self employed or salaried but cannot prove their additional income such as bonus’s or profit shares and commissioned.

Under this program the client can obtain a mortgage or line of credit up to 65% of the purchase price of the home regardless of their taxable income.
EDIT: You are (partially) right :) there is a 10% DP program for stated income, coming with some strings attached (good credit, CRA statements, contracts, etc. and more documentation) as well with REQUIRED insurance from Genworth and ONLY brokers who worked with it

Mortgage default insurance rates for self-employed mortgages without proof of income
If you cannot provide sufficient proof of income, you must put down at least 10%, and you will have to find a lender who uses Genworth or Canada Guaranty. Only those two providers3 offer mortgage default insurance for stated income files, at the following rates:Down Payment (% of Home Price) 5%-9.99% 10%-14.99% 15%-19.99% 20% or higher
Insurance premium percentage N/A 5.45% 3.35% 1.90%

https://www.ratehub.ca/self-employed-mortgage
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Jan 21, 2017
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Problem here is, these guys don't pay a lot of tax (income tax) and drive up real estate prices.

Unless these guys are investing money in building companies, creating jobs, developing infrastructures, just parking money in houses is pretty bad in my opinion.
Deal Addict
Jan 20, 2016
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Houston, TX
DPR2017 wrote: Problem here is, these guys don't pay a lot of tax (income tax) and drive up real estate prices.

Unless these guys are investing money in building companies, creating jobs, developing infrastructures, just parking money in houses is pretty bad in my opinion.
Owner of 4M home pays property tax each month as I'm paying for whole year. THIS one itself is funding roads, schools and others as well. Once he's buying ANYTHING in Canada, he's paying 13% HST on it.
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Oct 9, 2008
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asa1973 wrote: Owner of 4M home pays property tax each month as I'm paying for whole year. THIS one itself is funding roads, schools and others as well. Once he's buying ANYTHING in Canada, he's paying 13% HST on it.
Some people just don't think things through. Face With Stuck-out Tongue And Tightly-closed Eyes

Though big foreign money from the demographic we are all referencing may not work or own businesses in this country, their property taxes and consumption as a whole is a big contributor to us regular folk.
Member
Aug 23, 2014
414 posts
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Mississauga, ON
DPR2017 wrote: Problem here is, these guys don't pay a lot of tax (income tax) and drive up real estate prices.

Unless these guys are investing money in building companies, creating jobs, developing infrastructures, just parking money in houses is pretty bad in my opinion.
Also, the houses are either often occupied by just one person or rented out, either way the house usually isn't maintained properly negatively affecting the neighborhood.
Deal Addict
Jan 20, 2016
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Houston, TX
Jedi14 wrote: Also, the houses are either often occupied by just one person or rented out, either way the house usually isn't maintained properly negatively affecting the neighborhood.
I'd say house occupied by single person rather positive :) for neighbourhood - less traffic, less utility usage (but he still pay all this monthly fees and boiler rentals etc.).
Maintenance is also not defined by type of occupation but rather by mindset - I saw quite a lot of "owner occupied" houses with absolute lack of maintenance (at least landlord has to think about it to be able to rent it, while "owners" sometimes just do not care...)
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Deal Guru
May 1, 2012
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Are people here really arguing that it is bad when a bunch of money is pumped into Canada?

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