Over the next three years, the federal government will be welcoming more than 1.3 million permanent residents to Canada. While it is expected these new entrants to the country will contribute to the economic recovery of the country post-COVID, how they go about the housing market is a challenge they are faced with. Mortgage brokers come to their rescue, helping them navigate the housing market, and all along the way as they have to face tough qualifying conditions to get their mortgage loans approved from conventional lenders. What is the definition of a newcomer? According to Statistics Canada, a newcomer is a permanent resident (sometimes also known as a landed immigrant) who has been in Canada for five years or less. Obstacles faced by newcomers As a newcomer getting a house of their own is a real challenge. They have to look for a house in a good area with good connectivity. Besides, they need to find a job, show credit history, and deal with the lenders for documentation and formalities before they can finally have their own house. All this while, they have to stay on rent and they'd rather stay in their own house and invest in equity there, rather than pay rent. Showing a credit history is perhaps their biggest challenge to deal with. This is because they have nil credit history and have to build it from the scratch. They also do not have any work experience in Canada and finding employment is a huge challenge for them. Even if they are able to land a job, their pay should be high enough for it to be able to cover the mortgage sum every month plus their living expenses. They may have some savings but with no income to show, the chances of getting their mortgage approved are thin. Only those who come to Canada with a job already in hand are in a better position to get their mortgage for their first house in Canada approved. How a broker can help? A broker comes in with his or her vast experience in the field of helping people get mortgages. They can help newcomers know about the various options available to them even when their credit histories are low. Mortgage brokers guide them to take car loans, leases, and other such instruments so that they can start paying the instalments and get their credit history up. For the newcomers who are self-employed, mortgage brokers advise keeping a good income record so that the gross income helps qualifies for mortgages. Mortgage brokers have a vast network of lenders to whom they can introduce newcomers for alternative lending instead of going the conventional way. Most newcomers are not even aware that if they don't qualify with traditional lenders, they can apply for mortgages with alternative lenders with more flexible rules as far as mortgage applications are concerned. If you are a newcomer finding your way around the housing market in Canada, need help with lenders and mortgage rules, or have any doubts, do contact LendX.
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