Important info about the down payment on your mortgage
Once you have the down payment for your mortgage there are a few things you will need. To protect lenders again fraud and prove the legitimacy of your investment, it is required by all lenders to show where you got the money from. Here’s what you need:
- You will need a three month history of your bank account with your name on it. This account must be linked to you and your social insurance number. Simply go to your bank and let them know what it is for. They will be happy to print it out for you.
- Any large deposits will require you to show the source it came from. If you sold a car, boat or jewellery etc. simply provide a copy of the bill of sale. If the money was transferred from another account, supply records from that account as well.
- If the funds have been acquired via gift, have a letter written and signed by the person who gave it to you. Note: Gifted funds are can only be accepted from immediate family members including parents, grand parents or siblings.
- Home buyers who are using funds from a Registered Retirement Savings Plan must provide a 3-month history of the account. Funds drawns from the Homebuyer’s Plan, must be in your account for a minimum of 90 days.
- Funds arriving from out of the country must arrive at least 30 days prior to getting funding and must also be supported by a 90 day confirmation from the location.
- Deposit all of your cash in your bank account regularly. Don’t stash cash in the box spring or in a show box.
- If your are selling a previous home to make the down payment on the mortgage of a new home, provide a signed contract of purchase and sale as well as the current statement for that previous mortgage.
- On top of the down payment you will need verification that you have access to an additional 1.5% of the purchase price that will be used to cover closing costs.
This might seem like a lot of information to provide but the Federal Government does require it. Gathering this information as early as possible and keeping it well organized will make this process easy.