different financing with 3 or more properties?

[ryanlake]

Owner of three properties. During my last meet with my REIN Mastery partner she was explaining how banks look at your finances differently when you own three or more properties. I just wanted someone in the business to clarify this for me, and wondering how it will affect me.

 

[CurtisSvidal]

I can only speak to our (RBC) policy...three by itself doesn't mean anything. We used to have a policy of a 10 door maximum to be still under residential program but that was changed a couple of years ago to total single name exposure limit...$2M max in my area (Edmonton).

 

[Sherilynn]

Last time I checked, many banks start looking at your rentals as more of a portfolio once you have 4 properties. They no longer expect that your personal income will cover all of your debts and they count your rental income differently. Of course, it has been a while since I had 4 properties, and things have tightened up since then. For instance, on May 1st National Bank changed the way that they calculate the portion of rent that they will consider verifiable income, suddenly making it much more difficult to qualify.



In a nutshell, all banks have their own policies and an experienced mortgage broker that specializes in investment property is your best bet. And always make sure that your rent is at least 1.2 times your basic expenses (mortgage, taxes, heat, and possibly insurance).

 

[bizaro86]

[quote user=CurtisSvidal] I can only speak to our (RBC) policy...three by itself doesn't mean anything. We used to have a policy of a 10 door maximum to be still under residential program but that was changed a couple of years ago to total single name exposure limit...$2M max in my area (Edmonton).




Do you know what that number would be for Calgary?



Regards,



Michael

 

[CurtisSvidal]

Same for Calgary...only GTA/Vancouver are higher at $3M.

 

[terri]

TD is the same, they don't do total number of properties they have a cap mortgage limit, which also includes total amount of HELOC available. The amount that the cap at is lower I believe maybe $1mil-$1.5mil, or at least that's what they capped me at.