Canadian mortgage with Indian home loan

[Mounat]

Are you guys nuts? Why would you disclose your global income/debt to the bank? Keep quiet instead? Just disclose your Canadian income to the Canadian bank to keep it simple. They don't need to know about your business offshore, especially if it affects your serviceability. I didn't disclose any of my overseas assets or debts when getting my financing done. If they ask, just say that your overseas transfers to India are remittances for your parents and you can stop them at any time - don't tell them its for a mortgage.

The only person that needs to know about o/s property is CRA, and that's only under certain conditions.

I will let your words speak for themselves. Income and debt (and their ratio) are material information for a mortgage applicaton. Deliberately hiding, inflating, under-reporting or misrepresenting are all potential acts of fraud. Stating that periodic payments are "remittances" to parents and not for mortgage payments is the definition of misrepresentation. And in case you are not familiar with the word, here is its definition:

"intentionally or sometimes negligently false representation made verbally, by conduct, or sometimes by nondisclosure or concealment and often for the purpose of deceiving, defrauding, or causing another to rely on it detrimentally"

Now, please read that definition 10 times and get back to me.

 

[moscatojuices]

I will let your words speak for themselves. Income and debt (and their ratio) are material information for a mortgage applicaton. Deliberately hiding, inflating, under-reporting or misrepresenting are all potential acts of fraud. Stating that periodic payments are "remittances" to parents and not for mortgage payments is the definition of misrepresentation. And in case you are not familiar with the word, here is its definition:

"intentionally or sometimes negligently false representation made verbally, by conduct, or sometimes by nondisclosure or concealment and often for the purpose of deceiving, defrauding, or causing another to rely on it detrimentally"

Now, please read that definition 10 times and get back to me.

Look you're a good guy and I get where you're going. I never said that you should misrepresent yourself in any type of application, I have deliberately avoided mortgage fraud situations myself when brokers/bankers pressured me to classify a rental as an owner-occupier so that I could get the loan for my first condo. I refused to do so and the deal collapsed. My good judgement came back to benefit me a year later, after I got my PR, a better credit score and a better deal on my loan for that same condo.

But here's the thing, Canadian banks *do not ask* you about your foreign income and liabilities. I've dealt with TD, RBC, BMO & a broker, and none of them did it. Why? Because they do not have the capabilities to verify it nor account for it. They only ask you about your Canadian income and liabilities, and they base their information on Canadian sources like your T4s and credit reports. That means you are free to base your Canadian finances based on your Canadian income/debt circumstances, and leave your foreign affairs in your foreign jurisdiction. Your ability to service your debts in separate jurisdictions is entirely on you. You're an adult - you don't need to go around telling every bank in the world you have a relationship with that you a mortgage in XYZ countries. Mortgage fraud doesn't come into the picture unless you're starting to hide stuff in the same jurisdiction where it applies. That bar is very high and underpinned by intent.

CMHC doesn't want Canadian banks babysitting millions of immigrant adults and messing up the economic cogwheels of Canada because they suddenly have to start factoring in people's foreign incomes and debts, and intersperse that within their Canadian loan application. That's actuarial-level stuff that would destroy the mortgage market. These bankers are paid not much above minimum wage for the simple task of verifying that your Canadian income vs Canadian debt payments don't exceed a 30-42% serviceability ratio (depending on the bank). If you start adding foreign income/debt into the mix, the housing market would likely collapse, as it would take months to approve loans.

If your bank isn't asking you for your foreign income/debts, or isn't able to take them into account, then you've performed all the disclosure required on your part. If you decide to force your foreign debt onto the bank into their underwriting process, you're really just shooting yourself in the foot. As I said, you don't need to disclose that you do cocaine at a job interview. Just keep some of these things to yourself.

 

[Mounat]

I do agree that answering unasked questions is unnecessary and could backfire. But withholding requested information is a bad idea, and likely illegal, depending on the context.

It's true that Canadian banks may not explicitly ask about foreign debt for the reasons you mentioned but that doesn't make the borrower any less leveraged. And things are changing, and with the influx of immigrants in recent decades, it's not unreasonable for banks to start asking specific questions about foreign debt, if they aren't doing it already.

Look you're a good guy and I get where you're going.

I'm actually a terrible person but I try to follow most rules.

 

[moscatojuices]

I do agree that answering unasked questions is unnecessary and could backfire. But withholding requested information is a bad idea, and likely illegal, depending on the context.

It's true that Canadian banks may not explicitly ask about foreign debt for the reasons you mentioned but that doesn't make the borrower any less leveraged. And things are changing, and with the influx of immigrants in recent decades, it's not unreasonable for banks to start asking specific questions about foreign debt, if they aren't doing it already.



I'm actually a terrible person but I try to follow most rules.

Look I get it, me too. I was ultra strict with my immigration application and disclosed everything right down to the 180th trip on my travel history. The other day I got high with a friend, and then refused to drive for 48 hours just because I was that worried that if I was to get tested, there would be cannabis in my system. I myself fired a mortgage broker for trying to game the system to get me a rental loan by classifying it as owner-occupier.

So at the end of the day, the legal disclosure obligation between banks for the purposes of a Canadian mortgage only boils down to this: your Canadian income and your Canadian debts, and you can't hide your Canadian debts anywhere because that is the very reason TransUnion, Equifax exist. They already KNOW, that's why they don't even ask about your debt because it's all there on the record. Those factors are the primary things your bank cares about.

The issue with leverage is separate. That is where "adulting" and "financial responsibility" comes in. I have 3 loan facilities back in the UK. One for my rental, which is technically paid off and generates income. The other is for stocks, and that loan is paid for by the dividends earned by my stocks and my rental. I don't even have to do anything because it's all passive. My parents have had their Indian stocks and Indian rents for decades - the UK banks (like Canadians) told us "We don't give a shit." Your foreign income doesn't count towards your serviceability, so by that same token why should your foreign debt be taken into consideration???? It's unnecessary information that only complicates the borrowing process. You as an individual are responsible for servicing your obligations in those corresponding jurisdictions.

 

[Mounat]

UK banks (like Canadians) told us "We don't give a shit." Your foreign income doesn't count towards your serviceability, so by that same token why should your foreign debt be taken into consideration???? It's unnecessary information that only complicates the borrowing process..

That might be what it boils down to and I've experienced it here in the past even though Equifax and TransUnion are in the US but weren't really tied to their subsidiaries in Canada. Still, a bank may wish to know if a borrower has left a trail of bad debts across several continents. But if they don't ask, by all means, don't tell.

 

[moscatojuices]

That might be what it boils down to and I've experienced it here in the past even though Equifax and TransUnion are in the US but weren't really tied to their subsidiaries in Canada. Still, a bank may wish to know if a borrower has left a trail of bad debts across several continents. But if they don't ask, by all means, don't tell.

Yes they're American companies but with local franchises required to adhere to local laws/regulations in their jurisdictions. Data privacy laws have that your data can't just be sent to the US and Europe willy nilly. I have accounts in UK Canada Australia, all of those are separate collected by Equifax UK Canada Australia etc.

A bank would LOVE to know about your trail of bad debts, but don't worry they're smart and are more than capable of protecting themselves even if they don't know. That's why they wonderfully get you to do this little thing called paying CMHC, or forcing you to put down a 20% deposit, along with verification that you've been a good borrower in between your credit scores. They also take out appraisals to ensure you're paying at or below market price.

That way they've taken a calculated risk and if you buy a home and immediately default, they're going to be selling it for a tiny profit - the borrower on the other hand is sanctioned financially, for the rest of their life. Imagine that eh? Being bankrupt, having your credit score crash to <500. You won't get a job or a credit card with that kind of a profile. Banks will always stack the odds in their favour - they don't need to know more because they've got their asses covered.

 

[moscatojuices]

lol what a coincidence: Mortgage Fraud episode on CBC - https://gem.cbc.ca/marketplace/s50e02?autoplay=1

 

[moscatojuices]

I CANNOT stress, I am not suggesting anyone commit mortgage fraud. Do not inflate or understate your income. Do not lie about your debts. I take immense pride that in this country, the vast majority of people are honest about things in their day to day conversations. I don't want Canada to turn into a ghetto like India where you just can't trust people because everything is forged.

My comments are restricted to a singular focus - there is no need to disclose your foreign debts, unless asked, because a Canadian lender cannot account or verify them. At the end of the day they have a duty and process to ensure they get what they want from you to assess your serviceability, but they can only ask so much or ask what is required in line with regulations. But your mortgage in Canada and mortgage in Australia - they're all separate matters and you, as mature, responsible adult need to ensure you can service your individual debts in the corresponding jurisdictions.

 

[AishaRangel]

Totally agree with you that it's important to be honest when it comes to mortgage applications. Fudging the numbers or lying about your financial situation is never a good idea. It's better to be upfront and honest, even if it means you might not get the loan you were hoping for. As for foreign debts, I think you're right that it's not always necessary to disclose them. But at the same time, you don't want to take on too much debt, whether it's in Canada or abroad. It's important to make sure you can handle your debts and not get into a tough financial situation. If you're looking for a good lender, have you checked out Vanguard loan? Just remember to keep things honest and responsible when it comes to your finances.

 

[milon45]

Hi All,

Currently I am in Canada with PR status.
Me and my wife are currently working with a gross income of around ~230K dollars p.a.

Like everyone else, we wish to buy a house in Canada down the lane. By next year we will save for the down payment as well.

Before that, I'd like to buy a house in India. For this, I’m planning to take a housing loan in India for around 70 lakh INR (Rs. 20 lakh initial). If I take that, I will be paying around Rs. 55,000 per month (which is roughly around $1,000 CAD). I’ve been looking into various options and came across some PHH Mortgage reviews that might be helpful for understanding similar loan processes. If anyone has experience with international loans or can offer advice on this, I’d appreciate your insights!

Will this housing loan of Rs. 70 lakh ($120K CAD) affects my Canadian mortgage eligibility in the future?

kindly advice.

Thanks.

Has anyone recently dealt with home loans specifically for PAs? I’m aware that physician loans often come with benefits like 0% down payment and no PMI (mortgage insurance). Are there similar options available for PAs? If you have experience with this or know of any such loan programs, could you share your insights on the process and how it worked for you?

 

[gauravs]

Has anyone recently dealt with home loans specifically for PAs? I’m aware that physician loans often come with benefits like 0% down payment and no PMI (mortgage insurance). Are there similar options available for PAs? If you have experience with this or know of any such loan programs, could you share your insights on the process and how it worked for you?

the terms you are referring to are applicable in the US. In Canada, there is always a minimum downpayment for purchase.

 

[FletcherHubbard]

Hi All,

Currently I am in Canada with PR status.
Me and my wife are currently working with a gross income of around ~230K dollars p.a.

Like everyone else, we wish to buy a house in Canada down the lane. By next year we will save for the down payment as well.

Before that I like to buy a house in India. For that I’m planning to take a housing loan in India for around 70lakh INR (Rs. 20Lakh initial).If I take that,I will be paying around Rs. 55000 /month (that is roughly around $1000 CAD)
jiofi.local.html tplinklogin
Will this housing loan of Rs. 70 lakh ($120K CAD) affects my Canadian mortgage eligibility in the future?

kindly advice.

Thanks.

As long as you can service the Canadian mortgage and put down an adequate downpayment, I think you will be fine