you can have a HELOC for more then 75% of the value but you endup getting hit with CMHC fees on the portion above 75%. So even if you could get the line of credit the gains are quickly wiped out by those fees and higher interest rates.Huestar wrote: ↑Hi,
I've been looking through this thread for a while and I recently decided to take the plunge and make a home purchase.
Since I'm relatively young and my girlfriend and I have outstanding student loans, we are only putting 5% down on the home and then using the remainder of our down payment to pay off our student loans.
So my question to the board is, is it possible to perform the smith manoever right out of the gates such as where I am?
The house is brand new and has yet to be built (closing date is July 2008) it will cost 425000 minus 22000 down payment (5%).
I've seen mention of a min. of 25% but no one has explicitly said that you absolutely need this. I would think that there must be a way start with less equity.
Thanks for all of the advice thus far!
Have you run the numbers on your plan, if you have enough for 10 or 15% down and keeping the student loans that may make more sense as you'll save a pile of CHMC fees and your student loan's interest is tax deductible. CHMC fees are reduced every 5% more you put down.