When looking to buy a home in Ottawa and you are finding that the neighbourhood you are interested in has homes that are a bit too dated for your needs. Or you find a house that catches your eye but it’s missing those one or two crucial things that you have to have. If this is the case, then the purchase plus improvements mortgage can help.
Perhaps you have found the house of your dreams but the bathroom, kitchen and so on needs improvement. Or, for example, you have a dog and you need a fence, or the roof needs replacing soon after closing.
If you have ever walked away from a near perfect home because of the cost required for the improvements, it’s important to know there is a solution.
Purchase Plus Improvements mortgage
With the purchase plus improvements mortgage, it allows those who are buying a home to work the cost of the improvements into the mortgage. The mortgage and the renovation funds will both be at a great rate with one convenient payment.
If you purchase a home and do not work the costs into the mortgage, these costs may end up on a personal line of credit or credit card. From that, they will be at higher interest rates and also give you a second payment or more to look after each month.
With the purchase plus improvements mortgage you can add up to $40,000 into your mortgage at the time of purchase. Depending on the renovation, a lender may make an exception to go even higher.
The improvement funds will be at the same rate as your mortgage.
At $20,000 renovation when added to your mortgage will increase your payment by about $45 bi-weekly, as an example.
Over the year, this will cost you about $450 in interest versus a credit card which will cost you about $4200 in interest for the year.