I don’t know if I will be owner occupying my suite, how will that affect my pre-approval?

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There are some important differences between applying for a mortgage for a rental vs. owner occupied suite.

Some of the most significant differences are listed below:

  • In order to secure a mortgage for a rental property your down payment has to be minimum 20%.
  • Depending on your final mortgage requirements there might be a premium added to the rate or mortgage default insurance charged.
  • Gifted down payments are not always permitted.
  • If you are self-employed there can be issues qualifying if you do not show enough personal income evidenced through tax returns.

When applying for a pre-approval if you are unsure state that your intention is to occupy the unit.

At the time of registration and closing once the building is complete you will have to re-apply for your mortgage and can discuss your options at that time.

This question was answered by Chris Molder (Mortgage Broker)

Roy Bhandari