REQUIREMENTS TO BUY A HOME
Is owning your own home a DREAM? Or would you like to make it a REALITY!
Below is a guide of what you will need to qualify for a mortgage at the bank or mortgage specialist.
You will have to establish credit.What that means is that you need to have had at least two major credit card for approximately 2 years and in good standing.The banks would like to see a clean credit score 640 and above.
In order to establish your credit rating keep all balances on credit cards less than 50 percent of what they allow you to have.Always pay 4 days before due dates.That way it is never late. (One day late is recorded one month late).Do a purchase once a month and pay the balance off in full, that way it records activity on your card.This is very important because if you get a card and hardly use it you are not building up your credit.
You can contact Equifax for your personal information and see what credit score is.There is a small charge of $15.50 to get that information.Here is the link as follows: https://www.econsumer.equifax.ca/index_en.html?transaction_id=102393435d9ajj717322b5405dec99.That way you can see where your score is.
*Letter from employer, stating start date of minimum 2 years in same industry, wage, guaranteed hours.Letter MUST BE: on company letterhead, dated and signed as well as contain a contact number for verbal verification.
- If using overtime pay or job bonuses or employment where hoursare NOT guaranteed,we will require the past two years Notice of Assessments (N.O.A) and an average of past two years earnings will be used for qualifying.If needed they can be ordered from Revenue Canada1-800-959-8281.
- Recent pay stub no more than 30 days old
- Proof of Closing costs to be at a minimum of 1.5% of the PURCHASE PRICE
5% or 10 % Down Payment Verification
There are several ways to verify down payment which may include one of or a combination of the following:
- If down payment is from savings 3 months bank statements for proof of down payment.Any sudden large deposits (2000 dollars or more will need to be explained & verified)
- If down payment is from RRSPs.Will require RRSP statements verifying that RRSPs are at a min. 90 days old.
- If Down payment is by way of gift, need a signed gift letter as well as funds being deposited at a minimum two weeks prior to possession.
- Proof of Closing costs to be at a minimum of 1.5% of the PURCHASE PRICE (for example a purchase price of $200,000 will require proof of closing costs in the sum of $3000.00 in addition to the down payment) Closing costs include but not limited to:Lawyer fees, property tax adjustments, interest rate adjustment, as well as home inspection.