Ways to manage your down payment while buying a house
The recent changes in the Mortgage rules and payment options may have made things difficult for the buyers, but, the there is no dearth of options for availing a house of your own.
On one hand there are stricter rules than before, on the other hand, there are ways to combat these rules and come out of them with the papers of your own house in your hands.
The challenge while buying a house
Those who have very little saving would actually fell under-confident before making an attempt to buy a house. The problem doesn’t end here; the increased down payment and a tighter mortgage rule make things even more difficult for you.
Ways to combat the issues while purchasing a house
- You can borrow from many other credit sources: Since, the down payment limit has been extended than before so that may work as a hindrance for many. But, here you can apply your sources and think of borrowing money from other agencies which are ready to offer you a loan. You need to be prepared for paying a higher interest rate than otherwise, but, when the aim is as big as buying a house, it should not be a problem for you.
- You can use “gifted down payment”: In case you have received a “gifted down payment” from your parents or grandparents or any other relative then you can always use this for meeting the challenges of increased down payment.
- You can consider of using “cash back down payment”: When you opt for cash back option you should be prepared for a higher interest rate than the normal one. You do have to bear the uncertainty of falling housing prices and changes in the mortgage rules which may affect your interest rate too, but then, you need to get prepared for all this.
- RRSP as a source of making down payment: If you are buying your house for the first time, then you can always borrow a maximum amount of $25,000 from your RRSP account for meeting your down payment. This gives you the benefit of not dealing and convincing a lender for giving you money. You can gradually make the repayment in an easy mode.
- Support from Government: Down payment assistance is provided by many of the provincial governments. The programs are meant for people belonging to low and middle income groups. The facilities are provided in such a liberal way that the buyer is allowed to buy a home even without making any down payment at all.
So, even if with changed rules you can buy a house for yourself by availing some of the above mentioned options.