If you’re looking for a trusted, experienced, and knowledgeable Regina mortgage broker to help a first-time home buyer, I am here to help. No matter what stage you are in the mortgage process, I can assist you in securing financing to get the home of your dreams. I also understand that all those mortgage rules and regulations surrounding the process can be confusing. My team and I are here to answer all your mortgage questions and help you achieve home ownership. In my latest tip, I explain Purchase Plus Improvements Mortgages
Purchase Plus Improvements Mortgages: Turning a Good Home into Your Dream Home
Sometimes the perfect home isn’t perfect—yet. Maybe the kitchen needs an update, the basement could be finished, or the floors are begging for a refresh. A Purchase Plus Improvements mortgage can help you buy the home you want and make the upgrades you need, all in one convenient mortgage.
What is a Purchase Plus Improvements Mortgage?
This type of mortgage lets you roll the cost of approved renovations into your home purchase. Instead of scrambling to find extra funds after you move in, you can finance the upgrades right from the start. It’s a great option if you’ve found a home in the correct location, but it needs a bit of work to feel like yours truly.
How Does It Work?
The process starts much like a regular mortgage, but with an extra step: you get quotes for the renovations you want as soon as you have an accepted offer. The lender approves the cost of the work, along with your home purchase price, and holds the funds for the renovations in trust until the work is complete.
Typical steps include:
- Get renovation quotes: These need to be from reputable contractors and submitted to your lender. Materials-only quotes are also acceptable if you are planning to do the work yourself.
- Close on your home: Your mortgage amount includes the approved improvement funds. Your down payment is based on the “as-improved” mortgage amount.
- Complete the work: You usually have a set time—often 120 to 270 days—to finish the renovations.
- Funds are released: After an inspection confirms the work is done, the lender releases the renovation money to you or your contractor.
When It Makes Sense
- You’ve found a home that’s almost perfect but needs updates to fit your style or needs.
- You want to avoid dipping into savings or taking out high-interest loans for renovations.
- You see potential in a property and want to add value right away.
Things to Keep in Mind
The renovations need to be planned and quoted before the purchase application is submitted. Time is of the essence. They must be completed within the lender’s timeframe. It’s also important to be realistic about costs and timelines—unexpected delays can affect when you receive the funds. Failure to complete funds within the prescribed timeframe may result in the lender requesting the funds be returned and applied against your mortgage balance.
Why Work with a Mortgage Broker?
Purchase Plus Improvements mortgages have specific requirements, and not every lender offers them. An experienced mortgage broker can guide you through the process, connect you with lenders who understand these products, and ensure your plans meet the program rules. That way, you can focus on transforming your new house into a home you truly love
PLEASE NOTE:
Mortgage rules and lender policies change all the time. Because Ryan has access to many lenders and have specialized expertise in structuring mortgage applications, he can determine the optimal way to structure your application to maximize the utilization of things like employment income, self employment income, Canada Child Benefit income, disability income, maternity leave, down payment sources, credit issues, debt ratios, etc. Choice of lenders, combined with his experience, can make the difference in qualifying and/or securing the amount you want. It’s not just about the best rate, it’s about flexibility and choices.
