It’s a sunny, Sunday afternoon and you’re house hunting. You remain optimistic as you visit the third prospect of the day, taking in the neighbourhood: proximity to schools, shopping and outdoor recreation, an easy commute to the office. The house is within your budget and you can imagine this being the driveway that welcomes you home at the end of a long day. You’ve all but said “yes” before stepping inside.

The door opens and you reach for a pen and paper. “The bones”, as they say, are good. The foundation is sturdy, the windows are a few years old, and it’s clear the previous owners had taken care of it. You do a thorough walk-through, considering the functionality of the floor plan, ensuring there are no signs of mold or water damage, and making a “to-do” list of cosmetic enhancements you’d like to see. Namely, the open concept kitchen-dining-living space you’ve always dreamed of. To suit your family and lifestyle, the house needs a bit of work, so you go back to crunch the numbers. With two small children, a mortgage, and other bills to pay, how is it possible to work in a renovation? 

Tackling a new home and renovations as separate purchases can lead to challenges down the road. Without the cash to conduct future renovations, you’ll need to finance the work, and relying on a loan, line of credit or credit card can cost you much more when you factor in interest. The end result is having two separate payments - one for your mortgage and one for the renovations - and you’ll build equity in your home at a slower rate.

Enter CUA’s “Purchase Plus Improvements Mortgage”, a flexible solution for those who wish to make improvements as soon as they take possession. With as little as a 5 per cent down payment, all costs - including the renovations - will be rolled into one monthly mortgage payment at a reasonable interest rate. And if you found your dream home unexpectedly without having saved for down payment, don’t worry! By applying for the Purchase Plus Improvements Mortgage, you may also qualify for the No Down Payment Mortgage, which can help you get into your new home faster. With this mortgage option, you’ll begin building equity right away and will have the comfort of knowing you’ll have a single payment each month.

Is the Purchase Plus Improvements Mortgage right for you?

Consider the following:
• Can I afford a 5% down payment?
• Does the house require partial upgrading (kitchen, bathroom, roof, windows)?
• Does the house have most of the items on my wish list, aside from the required upgrades?
• Can I complete the work on my own, or will I need to enlist the services of a contractor?
• Have I identified what’s required so I can get started right away?
• Is the timing right?
• Can I afford the bottom line in my monthly cash flow?

If you’ve answered yes to one or more questions, contact a member of our team and we’ll help you to determine the right mortgage for the right home. Schedule an appointment with one of our Financial Advisors before you go house hunting, and get the pre-approval first! Having this will help you narrow your scope. For example, if your budget is $250,000 and you view a house that costs $185,000 you’ll know your renovation budget has a ceiling of $65,000. If this is the season for house-hunting for you and your family, open the door to your new home with a Purchase Plus Improvements Mortgage from CUA. We’ll help you turn “to do” to “ta da”.

Revised Jun. 21, 2021