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Serving Perth & Oxford Counties

Purchase plus Improvements

Have you ever seen a home and thought “It’s in our budget, but it needs work”. Purchase Plus Improvements is a great program offered by CMHC and Genworth that can help your buyers get in their home and get the money for renos to make their home go from a ‘fixer upper’ to ‘Just what we were looking for’ without taking out a large home reno loan.

How does it work?

Now you can purchase a home, renovate it the way you like and pay for it all in one mortgage payment at first mortgage rates. All of this can be done by putting down as little as 5% of the “as improved” value.

For example, if you purchased a home for $120,000 and wanted to do $30,000 worth of renovations, GE/CMHC will insure a mortgage based on 95% of the “as improved” value. In other words, with a down payment of $7,500 (5%) GE/CMHC will insure a mortgage of $142,500. The key for this working is that the cost of the renovations has to be reflected in the “as improved” value of the house. In this example, GE/CMHC would have to agree that the house would have a value of at least $150,000 after the $30,000 worth of proposed renovations was done. The insured loan will be based on the lower of the purchase price plus the actual cost of improvements or the “as improved” market value.

Key Things to Remember

– Improvements need to add value to the property– paint, wallpaper is considered cosmetic

– Funds for the renos are not released until they are complete. If your contractor requires upfront payment, than you would have to to do a line of credit to pay before the renos are done (which I can also help with)

– You can borrow up to 20% of the initial value of the home, to a maximum of $40,000

Selling? Top 5 Projects That Can Increase Value of Your Home in a Buyer’s Market

1. Kitchen Upgrade

2. Bathroom Upgrade

3. A Finished Basement

4. Upgraded Lighting

5. Flooring

Please call me for more info on this and other programs available!

I am always available to answer your questions and will return your call or e-mail within 4 hours 7 days a week!


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