Reduce Mortgage Payments With A Basement Suite
January 12, 2017
Did you know that you may qualify for a bigger mortgage loan amount when you have a legal basement rental suite that can help generate extra income for you? That’s right! You can reduce your mortgage payments with the help of a basement rental suite.
With the recent Mortgage Rules change to implement a “stress” test, this is something that can help you still obtain your ideal home.
For example, our Morris homes start at $349,900. If you were to put 5% down, and include the required CMHC loan insurance into your mortgage, your monthly payment would be $1,541 per month for a total loan of $344,371. This assumes that you have no debt and a mortgage with rates at 2.49% and a 25 year amortization. The new mortgage rule requires you to have a household annual income of $67,000 in case of interest increases, rather than the old rule that required $54,000.
To help reduce your monthly mortgage payments, consider a home with a legal basement suite for extra revenue potential.
Purchasing a Morris home with a finished 1-bedroom basement suite start at $409,900 inclusive of GST. Again, if you were to put 5% down, and include the required CMHC loan insurance into your mortgage and assume the same mortgage terms as the example above, your monthly payment would be $1,805.15 with a required income of $80,000. However if you have a basement suite, you could potentially generate approximately $900 per month in rental income and therefore, reduce your personal monthly payments to just over $900 and only requiring $75,000 as your requirement annual household income.
If you are considering a basement suite, or would like to discuss how you can start building asset generation with home ownership, stop by our showhome. We’d love to help you purchase your first home and we’d love to welcome you into The Meadows Community.
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