Purchase Plus Improvements - Reno Money With Your Mortgage

[LifeHealthInsurance]

Thanks Rowan, this is very helpful information for when we buy a fixer upper.

[tsiaotsiao]

Thanks for the info!

[themortgagecentre]

Pretty good post. HOWEVER, depending on the amount of of the renos there are some lenders that will give the money up front.

[canadamortgage]

@themortgagecentre I've never seen it done. Had $2,500 declined the other day up front.

[themortgagecentre]

@canadamortgage Try another lender. For such a small amount there are. Assuming client meets all other criteria with the lender. Eg HSBC

[canadamortgage]

@themortgagecentre We may be talking about two different things. I'm talking high ratio (over 80% financing). Below that it's anybody's guess as it's the bank's choice. However, my examples were all high ratio as conventional borrowers typically (though not always) have additional funds for renovations. CMHC won't allow the loan to be advanced without it meeting their requirements.

[canadamortgage]

Sorry, there are no lenders that will give you the funds up front. The reason is, they want to make sure you actually use it for the renovations. By forcing you to get it done and THEN giving you the money, they guarantee themselves that the property will be increased in value by the amount of the renovations (in theory). At the very least, you aren't able to squander it on something unrelated. If you want the funds up front, you'll have to get a line of credit unrelated to the mortgage.

[BeautyFinish]

Thanks for the great post. My friend got renovation money but had a heck of a time actually GETTING the money and I didn`t understand why. Now I do. Are there any lenders that will give you the money up front?