Banks reaching out to help new Canadians buy a home

In the past, many immigrants to Canada came by sea--often landing at Pier 21 in Halifax. Nowadays, as a new Canadian, you are more than likely to touch down at Pearson International Airport after a journey of several hours rather than days or weeks. Either way, once on the ground, making a financial start has always been a tough route. Thankfully, today's evolution of technology makes it easier to prove your creditworthiness in Canada, and to qualify for a mortgage in order to buy your first home here.

"One of the key things ... is credit. You have to find some sort of credit history," says Jim Rawson, regional manager of Invis mortgage brokerage firm in Toronto. "With the Internet, with easy access to information, we can now check credit from just about anywhere, so we can get credit histories much easier than we could in the past."

As with any financial agreement, your credit status will determine how much you can borrow.

"There are different kinds of qualifications, depending on how long you've been here and depending on whether you have a job or not, whether you're landed immigrants or here on work permits," Mr. Rawson says. "But there are several lenders that have new-immigrant policies."

Every country has its own customs and laws when it

comes to home purchasing, and Canada is no different. Colleagues and friends can be a good source of recommendations for trusted accredited real estate agents, lawyers and mortgage brokers to guide you through the process. Canada Mortgage and Housing Corp. has also produced The Newcomer's Guide to Canadian Housing, which includes a section on what to consider when buying a home in Canada -- right from scoping out a location, to the documents required, to budgeting for the many expenses involved, and the process of making an offer.

As well as the usual costs attached to home purchasing, as a new immigrant, you will need to add on the additional time and expense of obtaining proof of your immigration and financial status and maybe even fees for wiring money

from your country of origin to cover the purchase deposit.

Buying a home will likely be your largest financial commitment when you come to Canada, but it may not necessarily be the most complex purchase.

"Getting a mortgage for a house was easier than getting a car loan," says Graeme Morton, who emigrated from Scotland to Guelph. "I had to get my colleague to counter-sign to get the car loan -- which was less than $10,000.

"And as for cellphones, they asked for so much proof as to who we were it was unreal. Obviously, houses are the less portable of the three!"

If you do not have a credit history, then financial institutions with specific programs for immigrants, such as HSBC and Scotiabank, may help.

"We have a program, where, even before they establish their Canadian credit history, new immigrants who are willing to put down a 30% downpayment will most likely be approved for 70% of their home purchase," says David Kuo, vice-president, retail branch network for HSBC, Ontario East.

Mr. Rawson at Invis says that in the past, immigrants could have been required to have a larger deposit to secure a mortgage.

"If you're not landed [a permanent resident] you might be looking for a larger deposit," Mr. Rawson says. "But the insurers CMHC and Genworth have pretty decent new-immigrant policies that [allow for] high-ratio financing."

("How to start fresh" prepared by Helen Morris/National Post)