How easy for a NON-RESIDENT to get a MORTGAGE?

Estimated reading time: 6 minutes

Canada’s Has a Limited Number of Banks

it is a big decision to either finance the purchase of a Whistler property through a bank in their home country, pay cash, or get a Canadian mortgage. These options must be explored. Therefore, the first line of Canadian financing is typically with one of the Canadian Banks. The top five Canadian banks are collectively referred to as the “Big Five” due to their dominant position and significant influence within the country’s banking and financial industry. They are, in no particular order:

• TD Toronto Dominion (TD)
• Royal Bank of Canada (RBC)
• Canadian Imperial Bank of Commerce (CIBC)
• Bank of Montreal (BMO)
• Scotiabank (Scotia)

Working with a Whistler Mortgage Broker

It is worthwhile noting that the decision for your mortgage application might be made in Toronto, Ontario, rather than in the Whistler branch. The Toronto banker may be unfamiliar with Whistler’s zoning for nightly rentals and suites. It is vital to have a mortgage broker who can easily explain the nuances of Whistler. Experience proves that working with a Whistler mortgage broker rather than a Vancouver mortgage broker will be your best option.

For more information on the ins and outs of buying property in Whistler as a non-resident, please read the Non-Resident: Finance and Funds page on this site.

How Do I Sign the Mortgage Documents if I am a Non-Resident?

The bank may ask you to return to Canada to sign the mortgage documents. Other banks send you the documents to get notarized by a lawyer in your area. It seems that there are continuous changes to the financing process of the Big 5, and here are the most current points to be aware of:

• 1) TD Toronto-Dominion Bank put the condition in the approval document that all borrowers must be at TD Bank in Canada to sign their mortgage documents on the closing date. This also applies to anyone assigned to the contract between the acceptance date on the contract and the completion date of the transaction. This is something to be considered when adding a family member to the title. Are they going to be able to be in Canada at the time of closing?
• 2) Scotiabank doesn’t make it a requirement to be in Canada to sign the mortgage documents, provided the Buyer’s lawyer is satisfied with these buyers signing outside of Canada. However, the lawyer may only be satisfied with this if the lawyer has actually met and verified the buyers against their passports.
• 3) When a Non-Resident obtains a mortgage, the bank wants confirmation that the buyer has sent the deposit and the balance of funds to Canada. In other words, the bank wants to make sure the buyer has the funds he claimed to have. The buyer’s funds must be held in their lawyer’s trust account 15 to 30 days before closing. The bank will not release the mortgage documents to be notarized until the lawyer and Buyer’s brokerage confirm the funds are in Canada.
• 4) The mortgage documents received by the buyer must be sent to each person on title to be wet-signed and notarized. This can take time.

Whistler Lawyer to Verify Your Identity

When the BC or Whistler lawyer has met the non-resident Buyer and verified them against their passport, the mortgage documents can typically be emailed to the Buyer. The Buyer then takes the mortgage documents to a nearby lawyer or notary (approved by Buyer’s lawyer) who will witness the buyer signing the documents. The documents are then emailed back to the Whistler lawyer. However, some banks insist that original mortgage documents, not emailed copies, are signed. This is important information when working with an international buyer who has not been verified by the BC lawyer. The mortgage documents may need to be the original documents, not emailed copies.

When the Buyer’s lawyer has not verified the Buyer against his passport, the Buyer’s lawyer will set up an appointment with a lawyer in a location suitable to the Buyer. The Buyer’s lawyer will mail or courier the documents to the out-of-country lawyer. The Buyer will go along to the lawyer’s office to have their identity verified against their passport. All of this can go smoothly, or not.

Financing a Property that is Tenanted

Currently, Scotia Bank will not finance a US borrower if the house or legal suite is rented at the time of occupancy. If the house or suite is rented before or after the closing date, that does not seem to matter. Fickle.

Non-Resident Balance of Funds Wired to Canada

After the subject conditions are removed, the non-resident Buyer has to 1) wire the deposit to the brokerage of their buyer’s agent where the funds are held in trust, and 2) send the balance of the funds to their lawyer’s trust account. Depending on the closing date and whether there is a mortgage influences when the balance of funds must be sent to Canada.

In this post, there is a mortgage. The finance company wants to see the Buyer’s money in Canada 15 to 30 days before closing. Once the bank receives confirmation from the buyer’s lawyer that the funds are held in trust, the bank will release the mortgage documents to the buyer’s lawyer. In other words, the bank will not release any documentation confirming the mortgage until the bank receives confirmation that you have the funds.

Upon receipt of the mortgage documents, the Buyer’s lawyer distributes the mortgage documents to each person on title for their notarized wet signature. This means that each person has to meet with a lawyer (approved by the Buyer’s lawyer) and have that lawyer witness their signature. Once witnessed, the document is either emailed or couriered, depending on the bank, to the next person on title. Therefore, when an offer from a non-resident includes financing, working with an experienced mortgage broker is essential. The mortgage broker is the person who coordinates all of this activity, no mean feat!

Is it Possible to Refinance After the Completion Date?

It is not an option for the non-resident buyer to refinance their property. Some non-resident buyers pay cash for their Whistler property with the view of obtaining financing when they have more time. Refinancing is not an option for Non-residents is a good read for more information.

In summary, it is essential to explore your financing options at the start of your search for a Whistler property. By doing this, you will then understand your options and can make your buying decision accordingly.

Next Steps

If you think I would be a good fit to work with you and your family, and you are not already working with a Whistler realtor, please contact me. My name is Marion Anderson, and I help people buy real estate in Whistler.

Marion Anderson Personal Real Estate Corporation
Sutton Group – West Coast Realty, Whistler
marion@marionanderson.com (604) 938-3885