If you are part of this group, chances are you’re a landlord earning rental income. Rental income can be leveraged in a mortgage application to increase your approval amount, however the increase you’ll see in your borrowing power can vary substantially from one lender to another. This is because when it comes to rental income, the policies between banks are very different as some lenders are much more generous than other.
You may have heard the terms “rental income addback” and “rental income offset” and figured they are one in the same, but they are very different. Some lenders use addbacks, some use offsets. The difference could mean HUNDREDS of THOUSANDS of dollars in additional mortgage approval. This means more equity available in a refinance, an increased limit on a Home Equity Line of Credit, or an approval on a new rental purchase that your preferred bank declined. In a recent 4 plex refinance file the difference in available equity between 2 major Canadian banks was $400,000!!
Tune into the upcoming webinar
where I will explain the difference between rental income addbacks and offsets and how they could impact your portfolio. We’ll dig into the math, and I will share some real world examples. If you have questions in the meantime feel free to reach out.
