An Overview by Michele Mooney

Canadian interest rates remain at an all time low, properties in the Whistler, Squamish and Howe Sound Corridor are more popular than ever. The 2010 Olympic Games are just around the corner and the exchange rate remains attractive... whether you are thinking of buying for investment or recreational purposes the timing couldn't be better.

Financing for property in Canada for international clients can be a fairly simple process, as generally many lenders in Canada will approve financing up to 65% of the purchase price, with relatively limited supporting documentation, and in some circumstances they may lend as high as 75%. For a US resident working and living in Canada it is possible to secure 100% financing on the purchase of a principal residence.

Another method used to assess the maximum lending value is the sliding scale; this scale varies from lender to lender and typically affects higher priced residences. For example, the lender may offer a maximum lending value of 75% on the first $500,000 and only 50% on the balance of the purchase price, therefore on an $800,000 purchase price the maximum lending value would be $525,000.

There are no restrictions for international buyers as to which of the numerous mortgage terms they can choose; ranging from variable rate terms to open or closed fixed rate terms, which can be as short as 6 months or as long as 10 years. Morgages can be amortized for up to 30 years, but more typically they are over 25 years.

For the international buyer the maze of mortgage terminologies may be unfamiliar and these will need to be clarified by the lender, in particular such terms as "payment hypothecation" or "assignment of rents" are often associated with non-resident applications.

"Payment hypothecation" is a pledge, typically, up to six months worth of mortgage payments, which are collected at the time of the mortgage as an advance and held in trust for the applicant. Most lenders will release the funds after 12 months of satisfactory repayment on the mortgage.

Many properties in Whistler are rented, so lenders will ask for an "assignment of rents", which is a document registered on the title of the propery allowing the lender to collect rent for the property directly from the renter, in the event that the mortgage goes into default.

Michele Mooney - Mortgage Advisor, Global Morgage Corporation