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How can a non-resident buy a house in Canada?

If you are a non-resident who is looking to purchase a home in Canada, you will be happy to know that buyers from all over the world are welcome. There are however a few important details that you should be aware of as a non-resident. 

How can a non-resident buy a house in Canada?

What is a non-resident? 

This is not defined by citizenship but rather lenders will consider you to be a non-resident if you do not earn income or file taxes here in Canada. 

Non-residents will require a higher down payment in order to get a mortgage.

If you are a non-resident and looking to get a mortgage, you are going to have to save a higher down payment than a Canadian resident would. For U.S. residents, you must have a down payment of at least 20%. 

For those who live anywhere other than Canada or the U.S, you must have a down payment of at least 35%. Furthermore, the down payment must be funds that you have saved yourself and not be a gift from someone else. 

What documents do non-residents require when they apply for a mortgage in Canada?

  • Proof of income (this may include documents such as a letter of employment, tax returns or pay stubs, however it cannot include rental income).
  • Proof of down payment
  • A letter of reference from a foreign bank
  • Recent international credit report

Are there any special conditions on mortgage for non-residents?

Generally speaking, non-residents are able to access the same mortgage products as residents provided that they meet all of the eligibility criteria. There are however a few restrictions including: 

  • Some lenders charge a higher rate to non-residents.
  • Amortization terms for non-residents must not exceed 25 years.
  • Home equity lines of credit are not available to non-residents.
  • Refinancing is not an option for non-residents. 

Do non-residents have to physically come to Canada to purchase a home? 

If you are a non-resident looking to purchase a property in Canada, you will likely have to come to Canada at least twice. You will have to open a Canadian bank account (and in most cases you must be in Canada to do this) and you will have to be in Canada at the time of closing on the property. 

What taxes should non-residents be prepared to pay whey they buy a home in Canada?

Non-residents must pay all the same tax and transfer fees as residents. Additionally, if you are buying a home in the GTA, you will also have to pay a non-resident speculation tax. 

If you are a non-resident looking to purchase a home in Canada, Matrix Mortgage Global can help. Contact us today for more information.

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