I have a question on Completion mortage. If I choose a builder to build the house and choose Completion mortgage option. I will pay 5% at beginning when starting the construction and will only require a mortgage upon closing. My question is whether CMHC will consider that I only pay 5% downpayment and charge the corresponding insurance fee, or CMHC will consider the ammount of downpayment when I require the mortgage upon closing? Thanks. t% X8 m! J! C5 j: _" F7 Z' ?3 f ) o0 `2 Y' D: a2 b0 Z1 t7 ~Another question: if I purchase the lot and apply for a mortagage for this lot purchase, does CMHC charge the insurance fee? Thanks.
Question 1: 1 m4 I( ?2 {8 S- }The mortgage company will calculate your downpayment percentage when they need to release the mortgage for your closing. If there is a CMHC insurance fee, the fee will be added to your final mortgage amount. ! P- C: e6 w0 V& I9 t8 K4 I ! ~6 X! }3 Q$ ]2 ^* \2 T/ RQuestion 2: if I purchase the lot and apply for a mortagage for this lot purchase, does CMHC charge the insurance fee? Thanks.! F, ^3 \7 C7 a1 A Normally, the lending company will not lend money for you to buy a lot (land).
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I have another question. If I choose Completion mortgage option, how much downpayment I need to pay at beginning when starting construction? I saw someone mentioned she only paid 5%. However, some builders told me that they need 20%. I want to check if that is negotiable? Thanks.
Yes, that is a negotiable item. Do you have a realtor? Ask your realtor to talk with the builder. Normally, 5% is good enough. But some builders need 10%. For those builder asking you 20%, their financial situation might not be that good.