Last week we sat down with mortgage specialist, Laura Krause, with the Mortgage Centre. Laura provided some great information. We barely scratched the surface and summarized three topics to consider when buying a residential acreage. Click the YouTube link to view the entire video.

1. Size

If a property has a house and garage plus an additional outbuilding (shop or barn for example) these buildings will not likely be part of the appraised value. Having said this, many appraisers are very well aware of this and have a large resource of MLS and private sale data that can still support the final evaluation.

2. Outbuildings and Use;

If the property being purchased has buildings under construction or that exist, and it is acceptable to the lender on a case by case basis, then the purchase must be insured and the borrower pays the premium. The premium will coincide with the loan to value.

3. Additional Use of Outbuildings;

If there are additional outbuildings such as a barn or shop the lender may ask of the intent of use by the borrower. In other words, they will want to know that a business will not be operated from the land/parcel and they may ask for a statutory declaration to be signed confirming the non operation of a business. If they are not confident that a business will not be operated then financing may become an issue.

ALL THE ABOVE IS SUBJECT TO LENDER POLICY CHANGES AND NO APPLICATION IS THE SAME. A CASE BY CASE BASIS MUST BE ACKNOWLEDGED. ADDITIONALLY THIS IS WHAT IS REQUIRED ON THE ‘A’ SIDE OF LENDING BUT OPTIONS ON ‘B’ SIDE AND PRIVATE MAY BE AN OPTION.

For more information you can contact Laura at:

☎️ (403) 350-7524
📧 laurakmortgages@gmail.com
🌐 www.laurakrause-mortgagelending.ca