Would love to share our (frustrating) experience of trying to refinance our home and buy a second property.
We have owned our home in Calgary now for seven years. We have excellent credit and a large amount of equity (the home was purchased for $301,000, and currently owe about $250,000. The home is valued at approximately $470,000). Two years ago, we moved to the GTA so we could be closer to family after the passing of a loved one. We have been renting out our Calgary home and are renting a house in Burlington. This summer we decided we wanted to purchase a small home (under $275,000) in Hamilton, with the plan of taking equity from our Calgary property and using it as a down payment. We faced two problems: the first being that we were denied the ability to refinance due to the Calgary home being a rental property, and second, we cannot qualify for a mortgage in Ontario because my husband is self-employed has not been operating for more than two years (and we were not allowed to use stated income). He has worked in the construction industry for more than eight years, has always had good income and we have excellent credit. We have a child and I do not work full-time, and I feel we are being penalized for this. We now feel trapped in an overpriced rental house, knowing that we could significantly lower our monthly costs if we could purchase in Hamilton.