Essential Insights into New-to-Canada Mortgage Programs

Starting a new life in Canada is exciting, but navigating the mortgage process can feel overwhelming. As mortgage specialists helping newcomers in Canada, we often work with immigrants who want to purchase a home but are unsure about eligibility and requirements.

That’s where New-to-Canada mortgage programs come in.

These special mortgage options are designed to support permanent residents and newcomers as they build credit and establish financial roots.

Let’s break down what’s included in New-to-Canada mortgages and just as importantly, what’s excluded, so you can plan your next steps with confidence.

---

What New-to-Canada Mortgages Include

1. Access to Home Financing With Limited Credit History

Most newcomers haven’t had time to build a strong Canadian credit profile. New-to-Canada programs allow borrowers to qualify using alternative credit (such as rental payment history, utilities, and cell phone bills).

2. Minimum Down Payment of 5%

For homes under $500,000, most New-to-Canada mortgages allow qualified applicants to buy with as little as 5% down, just like Canadian citizens and long-time residents.

💡 Pro Tip: The down payment must come from the borrower’s own funds (not gifted or borrowed).

3. CMHC and Sagen Backing

Major insurers like CMHC, Sagen, and Canada Guaranty offer default insurance for New-to-Canada applicants. This makes lenders more willing to approve your mortgage, even with limited credit.

4. Flexible Employment History Requirements

While most lenders want to see stable employment, New-to-Canada programs often accept shorter employment histories (3–6 months), provided income is steady and provable.

5. Access to Competitive Interest Rates

Contrary to popular belief, many newcomers can access prime mortgage rates, especially if they have permanent resident status and reliable income.

---

What New-to-Canada Mortgages Exclude

1. No Support for Non-Residents

These programs are not available to non-residents or visitors. You typically need to be a Permanent Resident (PR) or have landed immigrant status to qualify.

2. No Gifted Down Payments from Overseas Sources

Most lenders will not accept a down payment that is:

• Gifted from someone outside Canada
• Unverified in terms of source or origin

If funds are coming from abroad, they usually need to be in a Canadian bank account for 90+ days.

3. Limited Property Types

New-to-Canada mortgages typically exclude investment properties. Most programs only allow financing for:

• Owner-occupied homes
• Principal residences

4. No Unverifiable Income

If you’re self-employed, paid in cash, or lack official documentation, it may be difficult to qualify. Lenders require:

• Pay stubs
• Employment letters
• T4s or NOAs (if available)

5. No Alternative Lending (in many cases)

Most New-to-Canada programs are offered through A-lenders (banks and credit unions). If you don’t qualify, alternative or private lending may be your only option, but these come with higher rates and stricter terms.

---

Who Qualifies for a New-to-Canada Mortgage?

You may qualify if you meet these criteria:

• Arrived in Canada within the past 5 years
• Hold permanent resident status or are in the process
• Have a valid work permit
• Can provide alternative or traditional credit
• Have a stable income

If you’re not sure where you stand, don’t worry, that’s exactly where we come in!

---

Final Thoughts: Don’t Let Paperwork Get in the Way of Your New Canadian Dream

New-to-Canada mortgages are a fantastic pathway for newcomers looking to plant roots through homeownership. While there are some exclusions to watch out for, these programs are designed to include and support you.

---

Need Help With Your New-to-Canada Mortgage?

If you’re a newcomer in Canada and want personalized help navigating your mortgage options, we would love to hear from you.

Contact us and we will guide you every step of the way.

At Indi Mortgage, we offer a fresh, modern approach! One that’s simple, transparent, and built entirely around your needs and long term goals. We believe getting a mortgage shouldn’t feel overwhelming. It should feel empowering and exciting!