Financing home improvements
Talk to your lender or broker if your new home needs repairs or renovations. There may be financing options that can be included with your mortgage loan. If you make energy efficiency improvements, you may qualify for a partial refund of your mortgage loan insurance.
How much can you afford?
Calculate how much you can afford to spend on housing each month without putting your financial health at risk. These two simple rules will show you what you can afford to pay for a home. Understanding these rules can also help you when it’s time to get approved for a mortgage.
Your monthly housing costs should be no more than 32% of your average gross monthly income. This percentage is known as your gross debt-to-income or gross debt service (GDS) ratio.
Housing costs include: your monthly mortgage payment (principal and interest), property taxes, heating expenses.
Your monthly debt load should be no more than 40 per cent of your average gross monthly income. This percentage is known as your total debt-to-income or total debt service (TDS) ratio.
Your monthly debt load includes: housing costs, car loans or leases, credit card and line or credit payments, line of credit payments.