New immigrants buy real estate too!

You’ve just come to Canada and you’d like to buy real estate.

No problem!

Although, you will have to get credit, but as I said, the conditions for that are not so complicated. You have to be employed (because otherwise, how would you pay off the credit?), you must give a minimum 5% down payment and have some credit history, be it Canadian or from “the old country.”

I believe that the majority of immigrants who come to Canada have the intention of settling down sooner or later. Otherwise, why would they come to cold Canada if they don’t want their little piece of privacy, peace, and warmth? It is cold, but the standard of living makes up for it!

The credit program for new immigrants with permanent residency¹ is designed with the assumption that the majority of immigrants will stay and build their new lives in Canada. Otherwise, why would they go through a relatively rigorous immigration process if they do not intend to devote themselves to their new lives, which includes paying off credit on a house, right? Well, worst case scenario, to at least get a passport.

For that very reason, the program for new immigrants who wish to purchase their first piece of real estate is very accessible and simple. That program is offered by the majority of banks, and because of its low down payment, it is insured by both the Canadian Mortgage Housing Corporation (CMHC) and Genworth.

Firstly, those who can participate in this program must have arrived in the past five years and must have permanent residency. There is no specific time period after which one can apply for credit, although all applicants (whose income is used as a basis for qualification) would have to pass a probation period, which often means around three months after starting at a new job.

Speaking of employment, the applicant must be a permanent, full-time employee. Those who work on contract, are self-employed, or work part-time must wait for two years to pass before being able to qualify on the basis of their average income over the previous two years.

A minimum down payment of 5%² would represent so-called “traditional” that is, non-borrowed funds, such as personal savings, although CMHC allows monetary gifts from close family members (parents, siblings, and similar.)

For candidates who, in the meantime, have managed to build a respectable, albeit short credit history in Canada, it might be enough to satisfy the credit history requirement. An alternative could be to get a confirmation letter from the bank with which you did banking before emigrating, which—for countries where even a small connection can get the job done—should not present a big problem.