When applying for mortgage financing today it is ever more important to have your paperwork organized and ready to go…
Anticipating and providing what the banks need help to increase the success for approval, and make the process more efficient when offers are written and subject removal deadlines have to be met.
Here is a list of the items that will likely be required from you:
Your last 2 years T-1 General tax returns and the Notices of Assessment to go with each year. Why do you have to provide both? Because the banks want to see the T-1 General returns to see the source of where and how your income was earned, and the Notices of Assessment to confirm that the returns were filed properly and accurately.
Employment letter on company letterhead that confirms how long you have been with your employer, your position, and salary. If you are fairly new at your job, the letter should confirm that you are past any probationary period.
Current pay stub(s).
Why all of the above? The reasons are varying due to use of overtime, fluctuating hours, more than 1 source of income (ie 2 jobs), seasonal positions, self-employed, historical view of income, new employment, and/or return from maternity leave.
If self-employed operating with a limited company, the bank will ask for your last 2 year’s company financial statements + confirmation of your ownership of the company.
Work visas and/or permanent residency papers. If you are non-resident and are planning to purchase a principal residence with the intention of living in Canada, copies of work visas and/or confirmation of a pending application for permanent residency.
Recent credit report. If you are new to Canada and do not have an established credit rating yet, you may be asked to obtain a copy of your credit report from your home country, or a banker’s reference letter that confirms how long you have been a customer of your bank and if all dealings have been conducted satisfactorily.
ID such as passport and driver’s licence.
Verification of down payment. This is important. The banks want to know the source of where your down payment is coming from. Family gifts, RRSP withdrawals, inheritance, sale of property, sale of vehicles, and/or accumulated savings need to be confirmed. Typically they want to see a 90 day history of your bank account statements and if any large sum deposits are present, they will want to see the paperwork to confirm where the money came from for that deposit.
Mortgage statement for other properties. If you have other properties with outstanding mortgages, you will need to provide a current mortgage statement to confirm the current balance + the mortgage payments.
If you earn rental income, you will need to provide lease agreements and/or rental statements to confirm the rental income. In the absence of confirmable rental income, often we can work with an “ecomonic rent” letter of confirmation from a local appraiser. This can usually be arranged for a cost of approximately $150.00.
A VOID cheque from a Canadian bank account. The payments will be set up to be automatically debited from this account. A debit to an account outside of Canada is not possible.
If you have any questions or would like to discuss your mortgage financing needs, please contact the mortgage professionals at Garibaldi Mortgage to learn more.