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Mortgage loans have made purchasing a home in Newfoundland much simpler than before. If you are a first time home buyer or investor looking to purchase their next commercial or residential real estate, you should look towards applying for a mortgage loan with one of the companies we’ve vetted and listed for you below. An approval for a mortgage loan is quick and simple in Newfoundland. You will never have to wait in line and fill out a bunch of paperwork. Prospective applicants would only need to fill out an online application to then see their Newfoundland mortgage loan within a few days. Here at Smarter Loans, we’ve made it our duty to make the process seamless for you. Below you will find a list of trusted lenders that can provide you with a Newfoundland mortgage. If you explore through the options and compare them, you will be able to see the products being offered, interest rates, terms, qualifications and even some customer reviews.
When you find a mortgage loan that fits what you are looking for, click on the “Apply Now” button next to their name which will lead you to their website. Once at their website, it will then ask you to complete an online application form for their mortgage loans. Another alternative to acquiring a mortgage in Newfoundland is pre-applying through the Smarter Loans website. Once you pre-apply, we would find the most suitable match with your criteria. Within 24-48 hours, they would contact you to finish processing your request.
Qualifying for a mortgage in Newfoundland means clearing some basic financial hurdles. This includes:
Although traditional lenders, like banks, have fairly uniform and stringent financial requirements for their mortgages, online lenders and alternative lenders have plenty of options with more flexible prerequisites.
Getting a mortgage while self-employed can pose some challenges, but the good news is that the 8% of Newfoundlanders who are self-employed still have some options. Some lenders in Newfoundland will accept tax returns for the past two or three years in lieu of the standard paystubs usually required; others may require a higher credit score, or a larger downpayment; you may be asked to show business income documents and more detailed bank statements. As long as you can show proof of income though, you will have some options.
Mortgage interest rates can be fixed or variable. Which of these you choose will affect the rate you qualify for. Average fixed rates in Newfoundland are currently 3.35%; variable rates average lower, around 2%, or even as low as 1.74% for the most qualified borrowers.
The amount you need for a downpayment depends primarily on the value of the home you’re buying. Legally, the absolute minimum downpayment any buyer needs is 5% of the value of the home; most lenders however are much stricter than this, and require a 20% or 25% downpayment. The average home in Newfoundland costs $277,407, so a 20% deposit would mean you need $55,481 in cash.
Mortgages come with multiple fees: application fee, property appraisal fee, home inspection fee (if the lender requires one), title search fee, title insurance fee, loan origination fee, legal fees, broker fees, mortgage insurance fees, and potentially others. Generally, all of these together will come to somewhere between 2% and 5% of the loan amount.
The federal government has several programs to help first-time buyers get a foot on the property ladder. Bear in mind though that these only apply if you are buying your first ever home, not buying for the first time in the province. The First-Time Home Buyer Incentive allows eligible buyers to finance a portion of their purchase through the government. The Home Buyer’s Plan allows you to withdraw up to $35,000 from an RRSP to assist with your purchase. In addition, the provincial government has a Home Purchase Program that provides $3,000 towards newly constructed or existing new homes never sold or occupied, that are valued under $400,000.