RBC mortgage advisory

fvinvestor

New Forum Member
REIN Member
Nov 13, 2011
4
1
3
#1
There have been a few changes to RBC mortgages. We are in the process of moving our mortgage to another lender.

1. If you are refinancing with them they seem to have an internal cap of 60% LTV on properties over 1M. They tie up your main asset, and then do not allow you to access the increased equity to invest in other properties. Our attempt at re-if has been going on for over 3 months now, and we are 20+ year clients.

2. If one of the mortgage holders dies, the other must REQUALIFY when it comes time to renew, and not just renew. I heard of a lady whose husband passed away, and although she had a suite that paid for the mortgage, given her pension and OAS, her income was deemed to low to carry a 30% mortgage on her home of the past 20+ years. She was caught by the change and had to go the hard money lender route until she could get new financing when her renewal was denied by RBC.
 
Likes: Clinton R

Vine Group

Frequent Forum Member
REIN Member
Mar 17, 2016
127
76
28
#2
All lenders have different rules around LTV’s. The average lender will lend up to 80% LTV on first $1MM and then 60% LTV on the remaining amount above $1MM. In markets like Vancouver and Toronto where the pricing is already higher, exceptions can be made to get access to 80% LTV on as high as $1.5MM but again, this is an exception.

A mortgage is a contract that has been offered based on certain conditions being met. Technically the lender is able to force clients to re-qualify in a situation where someone has died to ensure the repayment on the asset is protected. Lenders are usually lenient in helping clients find a solution that fits, or providing time to find a reasonable replacement lender, but not always. Clients need to be ready for this. An insurance policy to mitigate this issue is also a great option.
 
Likes: Clinton R