Mortgages for Non-Residents

Quick Summery

If you are looking to buy a property overseas, Canada is a great location. Canada has modern cities as well as a stunning countryside.

Purchasing a property can be extremely expensive. Most people need a mortgage or financing from a bank or lenders to purchase a home.

Are you wondering if you could get a mortgage as a non-resident in Canada? In this blog, we will give you the information that you are looking for.

What Is a Non-Resident?

A non-resident is someone who works and pays taxes outside Canada.

You are considered as a non-resident in Canada for tax purposes if the following applies to you:

  • You typically live in another country
  • You lived outside the country for over a year
  • You don’t have powerful residential ties in Canada (a home, a spouse or common-law partner and dependent in Canada)
  • Your stay in Canada was less than 183 days in the tax year

Could a Non-Resident Get a Mortgage in Canada?

The answer is yes. Home buyers from other countries can own one residential property for their own purpose. Canadian banks and lenders commonly require a minimum of 35% down payment (with a maximum of 65% of the home’s value given that as a mortgage). Non-residents have equal possession right as residents.

General Qualifications for Non-Residents in Canada

Non-residents purchasing in Canada may be eligible if the applicant is:

  • Standard approval of income
  • Confirmation of assets
  • Acknowledged an adequate credit risk
  • 35% at least down payment
  • Rental or vacation property meets the standards
  • 25 years’ maximum amortization
  • Strong property appraisal
  • Has a recommendation from the country of origin or international credit bureau
  • Applicant should be physically present during the signing of documents. Out of country signing is prohibited

How to Qualify a Mortgage for a Non-Resident

Home buyers from across the country are welcome to buy a house in Canada. In general, there are no restrictions on the amount or kind of property you can buy. However, there might be some restrictions on the number of properties lenders will allow to finance up to five properties per person. Which varies vary from bank to bank.

As long as you meet the requirements provided by the lender (because some requirements may vary), you are more likely to get qualified for a non-resident mortgage. You also need to open a Canadian bank account for payments (the best time to get while you are in Canada).

What Mortgage Option Do Non-Resident Get

In general, provided that they meet the standard requirements to qualify, a non-resident can access the same mortgage option available to a Canadian residents.

Non-resident are also eligible to pay for the same interest rate as a Canadian does. It may also vary depending on your financial circumstances. If you don’t completely meet the standard requirement and the lender sees that you are a risky borrower, chances are you will pay for a higher interest rate.

As stated above, you can access the same mortgage option that will fit your circumstances. Here are some mortgage option you might consider:

  • FIRST TIME HOME BUYERS INCENTIVE PROGRAM

This program is basically for people who have never owned a house before. In rare cases, people who do have a house before qualifies. But it focuses on people who can’t afford to live in a house they could call their own.

  • FIXED-RATE MORTGAGE

Your monthly interest rate doesn’t change until the loan’s term-end. It is for the people who don’t want to take the risk especially when the market rates rise.

  • HYBRID ADJUSTABLE-RATE MORTGAGE

A hybrid mortgage (also known as fixed-period ARM) combines characteristics of a fixed-rate and adjustable-rate mortgage. This mortgage option has an initial fixed interest rate followed by an adjustable-rate for the rest of the term.

There are various mortgage products and services that may fit your financial circumstances. You may also visit https://faizalgarasia.com to know more about financial services that suit your budget.

When you are looking for the best mortgage with a poor credit rating, we can definitely help with whatever your needs are.

Final Thoughts

Obtaining a home as a non-resident is not as hard as you would think. However, when purchasing property across the country, you should always speak to a professional that will help you to understand the information you need regarding the financial aspect.

Connect with us, and we will help you to get a better understanding of non-resident mortgage options.

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