Portable Mortgage or Not? That is the Question …
As a repeat buyer you need to know what your options are in this CONTEMPRARY mortgage market.
Your mortgage is not ‘portable’ as you might perceive ‘portable’ to mean. Under today’s new and more stringent guidelines, you will need to “re-qualify” for the same mortgage you already hold. Often clients find out that they now qualify for significantly less than their current mortgage balance.
You need to discover this BEFORE you list and sell your current home, this is paramount!
In particular, the self-employed applicant (the owner of the business) needs to be having detailed conversations with an expert, a conversation that includes a complete overview of all documents required; as the list has grown radically since 2012. You most likely think you will not have a problem as you had qualified in the past for the mortgage.
However, all that matters, what it all boils down to in the end, is your Personal Line 150 on your Income tax document. Having $100.00 or $100,000 in liquid capital will not matter. Having never missed a mortgage payment in your life will not matter (99.69% of Canadians never miss a payment – so special is relative here).
Where business owner clients used to provide a single CRA (Canada Revenue Agency) Notice of Assessment, and not much else, they are today being asked for the following:
- 2 years CRA Notice of Assessment
- 2 years T1 General personal tax return along with statement of business activities
- 2 years Corporate Financials
- Documented proof of business for self (i.e. Notice of Articles, GST returns or Business License)
From previously supplying a few pages, to a few hundred, things have changed.
With a changing mortgage marketplace, you need to be kept up to date so that you can make an educated decision that is tailored to your current situation with the flexibility that you require.
Referrals are the Foundation of My Business! Please DON’T keep me a Secret!
Rita Cousins is Mortgage Broker with Dominion Lending Centres, she has worked in the Financial Services Industry for over 30 years. She lives in Langley city with her husband for the past 20 years.