Purchase Plus Improvements Mortgages: What Buyers Should Know

By Stefan Cherwoniak, Team Lead & Mortgage Broker, Quickfire Mortgage Solutions Team

Most buyers focus on finding the perfect home. The reality? Sometimes the best opportunity is a home with potential. A Purchase Plus Improvements mortgage allows buyers to finance eligible renovations as part of their mortgage, helping them create the home they want without needing separate financing after possession.

Finance Upgrades With Your Mortgage
With insured mortgages, buyers can typically finance improvements up to 10% of the purchase price or $40,000, whichever is less (some exceptions may apply). For a $400,000 home, that’s up to $40,000 available for renovations such as:

• Kitchen updates
• New flooring and paint
• Bathroom renovations
• Finishing a basement
• Window and door replacements
• Instead of paying for renovations later, the costs are rolled into the mortgage

Create a Legal Suite and Increase Purchasing Power
One of the most powerful uses of the program is adding a legal basement suite. With proper permits and contractor quotes, lenders may be able to use a portion of the future rental income to help buyers qualify. In some cases, this can increase purchasing power while creating a future income stream
to help offset mortgage costs.

Funds Aren’t Always Reimbursed. Sometimes They Are Paid Directly!
Many buyers assume they need to pay for renovations entirely out of pocket first. Depending on the lender and project, renovation funds may be advanced directly to the contractor after completion and inspection. This can help reduce immediate out-of-pocket costs and make larger projects more achievable.

The Bottom Line
Purchase Plus Improvements can help buyers look beyond cosmetic issues and focus on a home’s potential. Whether it’s updating a kitchen, finishing a basement, or creating a legal suite, the program can open doors that might otherwise be overlooked.

Download a PDF with some example improvement scenarios Here.
Contact Stefan and his team for more info!