What can I afford
Current interest rates will affect how much you can afford on the total mortgage and your monthly payments. Your REALTOR can help you calculate how much you are eligible to borrow based on your income and level of debt.
Your main expenses will include the down payment and mortgage as well as the costs of completing the transaction.
Down Payment and Mortgage
For a conventional mortgage, you will need to pay at least 25%
of the purchase price as a down payment. You can obtain a high ratio
mortgage—that is, pay 5% down and get 95% financing—if
you meet CMHC (Canada Mortgage and Housing Corporation) qualifications.
While you cannot borrow your down payment, gifts from relatives
or friends are acceptable. However, if eligible, you can borrow
up to $20,000 as an individual (or up to $40,000 as a couple) from
your own RRSP through the government's Home
Buyers' Plan.
There are definite advantages to getting
pre-approval for a mortgage before you start house hunting.
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