Since home refinancing has been limited to a maximum 80% of the value of your home, an increasing number of buyers are looking at Purchase Plus Improvements products to meet their home financing needs.
This may be an option worth examining if you would like to buy a new home that needs updating. Whether you’re purchasing a home that needs just a small renovation or a major redo, a Purchase Plus Improvements mortgage can help you transform an ordinary house into your dream home.
How purchase plus improvements works:
Purchase Plus Improvements programs enable you to obtain funding for the cost of the home purchase as well as the cost of the renovations – up to a maximum value of 95% of the total purchase price.
Conditions of the program include:
- As a borrower, you must provide a list of improvements with quotes at the time of application. As a result, more time may be required for subject removal.
- The initial advance of funds at time of closing will be up to 95% of the approved value of the property minus the cost of improvements
- The balance of the funds will be held in trust by the solicitor until completion of the approved improvements (time limits may be imposed), which is confirmed via:
- An invoice from the contractor who completed the improvements
- An inspection report or
- Confirmation from a certified appraiser or
- Usual sub-search and construction lien act requirements are to be adhered to at the time of release of holdback
- Some restrictions may apply depending on the lender
As always, if you have any questions about the information above or your mortgage in general, I’m here to help!