Question on Completion mortgag

bryant · 发表于 2010-7-26 08:41

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.

Another question: if I purchase the lot and apply for a mortagage for this lot purchase, does CMHC charge the insurance fee? Thanks.

小狗妈 · 发表于 2010-7-26 09:36

no, not at all

衣食住行 · 发表于 2010-7-26 10:35

Question 1:
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.

Question 2: if I purchase the lot and apply for a mortagage for this lot purchase, does CMHC charge the insurance fee? Thanks.
Normally, the lending company will not lend money for you to buy a lot (land).

bryant · 发表于 2010-7-26 10:51

Thank you 衣食住行 and 小狗妈.

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.

衣食住行 · 发表于 2010-7-26 11:33

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.

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