Myth 1: A 20% Down Payment is Required
One of the most widely disseminated myths concerning down payments is the idea that a 20% down payment is required to complete a home purchase. This simply isn’t true. Within the current Canadian real estate marketplace, buyers can begin the purchase process with a 5% down payment on their new home. To avoid having to pay insurance fees, a 20% down payment is required, but a 5% down payment can offer many buyers the ideal path to purchasing real estate.
Myth 2: Down Payment Assistance is Only for First-Time Buyers
While there are many marketplace programs designed to help first-time buyers enter the marketplace, there are a multitude of options for all homeowners seeking assistance for their down payment. For example, many local lenders will offer cash-back down payment mortgages, through which they will pay for the 5% down payment and then offer buyers a mortgage directly, to streamline the purchase process.
Myth 3: There are no Local Programs
The Government of Canada has ensured that down payment financing programs are now available to Canadians across the country, with the goal of helping more people find their ideal home. Consider for example, Ontario, which offers residents in the province up-to $60,000 through its CalHome program. The CalHome program offers loans at a 1% interest rate, and the loan is deferred for 30 years, which means buyers are required to pay back the loan plus the interest 30 years after completing the loan paperwork.
Myth 4: It is Too Expensive to Buy in the Marketplace
A common myth in the current Canadian market is that it’s too expensive to buy a home in Canada. This is simply not true, as lenders offer a range of programs to help buyers enter the marketplace and find homes that meet their budgetary parameters. There are many unique paths to homeownership for the proactive and committed buyer.
To uncover more on the myths of down payments in Canadian real estate, contact our mortgage experts directly!
source: northwoodmortgage.com
