It is important to be aware that certain financial institutions have programs for individuals with little income but a high net worth and liquid assets to obtain a mortgage.
Different financial institutions will have different requirements for minimum liquid assets and income. The general rule is that you need a minimum of $150,000 in liquid assets or a dollar of liquid assets for every dollar of mortgage required. It is important to note that a strong down payment is generally required in addition to the liquid assets for the mortgage.
For example if the client qualifies for a $200,000 mortgage using standard income and debt qualification and has $100,000 in liquid assets, they will qualify for a $300,000 mortgage.
Examples of liquid assets include: Canadian Stocks, GIC’s, TFSA’s, Chequing and Savings accounts, Canadian Bonds, Mutual Funds, Net Sale from Properties, and RRSP’s. It is important to note that 30% will be deducted from RRSP’s for tax holdback.