Qualifying 1. Credit Score

One of the three main criteria is Credit Score.

First, you need to have a credit history to be able to establish credit score (more info). Most Canadian lender uses Equifax for your credit history. All Canadians can obtain their own credit score for free if requesting it by mail (more info).

Here are some general guidelines.

> 700 => Anything above 700 is considered good credit. Score of 750 and 700 is generally treated the same under lender's guidelines. For self-employed individuals, 700 is the key criteria if borrowing to 95% loan to value (LTV).

> 680 => This is a minimum credit score for various fully discounted rate mortgages. This is also a minimum score for high ration lending at 100% for salaried individual, and 95% for self-employed individual. In other words, score less than 680 will not qualify you for zero down purchasing (salaried), or 5% down purchasing (self-employed).

> 650-660 => Some lenders have less stringent guildline for credit score, and 650-660 is where their minimum requirement sits. It is an essential level for high ratio lending. Score less than 650 will not qualify for 10% down payment under CHMC high ratio guideline. For conventional mortgages, 650-660 is a key for fully discounted rate with 25% down payment.

> 600 => Some banks, credit unions and institutional lenders accept score at 600s. This is the minimum score for a discounted interest rate. Anything lower than 600 will consider A- or B lending case. For self-employed individuals, this is not an ideal score range. Many mortgage products are limited with score less than 650.

See tips for maintaining credit score.