Basement Suite Income For Mortgage Qualification.

This is great information for those buyers looking for property with rental suite income. It is provided by Karen Gibbard.

There are two different sets of rules on the use of basement suite income for qualification:
a) High-ratio (less than 20% down payment) through CMHC or Genworth

b) Conventional (more than 20% down payment) – no CMHC or Genworth insurance required

For High-ratio mortgages, there are categories within this section depending on which insurance company you use:
i) CMHC – does not allow the use of any income from illegal suties – only legal and they will allow us to add 50% of this income to the client’s income for qualification purposes

ii) Genworth – They allow either legal or illegal suite income to be used for qualification. They will use up to 100% of the rental income (added to the client’s income for qualification) providing the property is located in one of the following areas of “Vancouver CMA”:

Abbotsford, Burnaby, Coquitlam, Delta, Langely, Maple Ridge, Mission, New West, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, Surrey, Vancouver, West Vancouver, White Rock. If the property is located outside of these areas, the maximum rental income allowed to qualify is 50% added to the client’s income for qualification.

For Conventional mortgages – Each lender has their own policy regarding the use of basement suite income for qualification. We have lenders who will allow us to use up to 90% of legal or illegal suites for qualification purposes.

Karen Gibbard, BGS, AMP
Gibbard Hoffart Financial Group Inc.
Accredited Mortgage Professional
Direct Line: 604-313-3199 x 111
#103-145 West 15th St., North Vancouver, B.C.
fax: 604-648-9974 / web:
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