Purchase Plus Improvements Mortgage – What is It?A purchase plus improvements mortgage is ideal for home buyers who have found the home for them, but know it is going to take a little TLC to meet all their needs. Instead of applying for a mortgage, buying the home, and then applying for another loan (or trying to save up some money) to do the renovations a purchase plus improvements mortgage contains extra money on top of the mortgage amount, for you to do all the required renovations.
Benefits of a Home Improvement Mortgage
The huge benefit of getting a purchase plus improvements mortgage is that you can start doing all your desired renovations as soon as you take possession of your new home. Any mortgage broker would also agree that another huge benefit is that the home loan and renovation loan is rolled into your monthly mortgage payments – giving you one less thing to worry about.
Banks that offer a Purchase Plus Improvements Mortgage
Homes are so expensive these days, so more and more people find themselves somewhat dated homes that require a little face lift. Because of this, purchase plus improvement mortgages are extremely common.
Some of the lenders currently offering purchase plus improvement mortgages are:
-Canada Mortgage and Housing Corporation
Can I get a Purchase Plus Improvements Mortgage with Scotiabank?
Scotiabank does not have a dedicated purchase plus improvements mortgage at this time. The closest thing they do have is their extremely popular “STEP” program – which is essentially a line of credit you apply for at the same time as your mortgage.
Getting a Purchase Plus Improvements Mortgage with CIBC
CIBC has two dedicated products for home renovations – their CIBC Home Power PLAN and their CIBC Home Power Mortgage. The former is a combined mortgage and line of credit. As you pay down the mortgage, the available money in the line of credit goes up, which is perfect if you decide to do more renovations down the line.
CMHC Purchase Plus Improvements
CMHC’s program allows buyers to borrow up to 10% of the as-improved value of a home. This amount can be used towards renovations and is conveniently included in the mortgage loan amount (again only one monthly payment). This program is great for people like first time home buyers who have small down payments and wouldn’t be able to afford and renovations on top of their down payment.
Getting a Purchase Plus Improvements Mortgage with RBC
RBC offers several home improvement financing options depending on how small or large your project is. For a big renovation RBC offers the RBC Homeline Plan. This is a mortgage and line of credit under one plan. Applicants can qualify for this program with a minimum of 20% home equity.
A mortgage broker makes applying for a purchase plus improvements mortgage fast and easy.
How to Get a Purchase Plus Improvements Mortgage
While all lenders have their own specific processes, the steps below are generally the path that most lenders will take during the process of applying for a purchas plus improvements mortgage.