Can I get a mortgage if I am not a permanent resident?
If you are looking to purchase property in Canada but are not a permanent resident here, you may be wondering if it is possible or if you’ll be able to get a mortgage. The good news is that anyone from anywhere in the world can get a mortgage in Canada. The rules for non-residents however are a little bit different however.
What is a non-resident?
A non-resident is anyone who does not earn an income or pay taxes in Canada. This has nothing to do with whether you are a citizen.
How much of a down payment do I need?
Most lenders will require non-residents to have larger down payments than residents. U.S. residents typically need a down payment of at least 20% while residents in other parts of the world usually need at least 35%.
What documents do I need for a non-resident mortgage?
- Proof of income in your home country. (This may include pay stubs, tax returns or a letter of employment).
- Proof of down payment.
- A reference letter from a bank in your home country.
- International credit report or bank statements going back six months.
What kind of mortgage can I get as a non-resident?
Generally speaking, non-residents can get the same mortgages as residents provided they meet the eligibility criteria. There are some restrictions you should be aware of however including:
- Some lenders will charge non-residents a higher interest rate.
- Amortization cannot be for more than 25 years.
- Non-residents are not eligible for refinancing or home equity lines of credit.
Is there anything else that I need to know?
When purchasing property in Canada, non-residents will generally have to make at least two trips to Canada. The first trip will be to open a Canadian bank account (although some international banks are now making it possible for non-residents to open Canadian bank accounts from their home country).
The second trip is because they must be present during the closing on the property since as of yet there is no power of attorney option.
It is also important to know that non-residents are subject to the same transfer taxes as residents, and if you are buying property in the Greater Toronto Area, you will also have to by Ontario’s Non-Resident Speculation Tax.
If you are a non-resident who is looking for a Canadian mortgage, we can help. Contact Matrix Mortgage Global today for more information.