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Our Purchase Plus Mortgage Experience

Nov 2, 2021

Are you struggling to find a home that meets all of your needs and wants? Or have you found a home with great potential that requires a little work before it’s move-in ready? If so, you may want to consider a Purchase Plus Improvement Mortgage. This type of mortgage allows you to purchase a home and fund the cost of renovations or upgrades in one convenient loan.

Today we’re sharing our personal experience with a Purchase Plus Improvement mortgage! We’ll go through how it works and why it may be the perfect solution for your home buying needs.

What is a 'Purchase Plus Improvements' mortgage?

A Purchase Plus Improvements mortgage allows qualified purchasers to borrow additional funds from their lender for improvements on a home. Buyers can typically borrow up to 10% or 20% of the value of a home, depending on whether they have an insured or non-insured mortgage. This program is great for buyers who do not have the cash in hand to complete signifiant renovations. It's also ideal for those struggling to find the perfect home in busy market conditions.

Why did we choose a 'Purchase Plus' Mortgage? 

Adam Popien Real Estate Kamloops pre-renovation house in Kamloops

How does 'Purchase Plus' work? 

Step 1 - Qualifying for the Purchase Plus Improvement Mortgage

To qualify for a Purchase Plus mortgage, you need to get a quote and scope of work for the renovations. Submit this to your lender when making an offer or during the subject removal process. Remember that the lender must approve the quote and scope of work before you can remove the subject conditions.

Step 2 - Complete Renovations

Congratulations on getting approved! Now it's time to start renovating, either with the help of a qualified contractor or on your own. Keep in mind that your monthly mortgage payments will include the purchase value of your home, as well as the additional loan for the renovations.

Important to note: Buyers must first pay the cost of renovations and building materials themselves. After the scope of work is finished and inspected, the lender releases funds to reimburse you for the expenses.

To cover the cost of building materials or contractors on a short-term basis, buyers often use:

  • lines of credit
  • personal savings
  • money from gifts or loans
  • or credit cards

It's essential to keep receipts of all purchases and contractor invoices in case of any dispute about the work completed.

Kamloops Home Renovations mid-way point with purchase plus improvement mortgage

Step 3 - property appraisal

After the renovations are finished, the lender will send an appraiser to verify that the scope of work has been completed to the value borrowed. The appraiser will then submit a report to the lender, who will release the funds to you within days.


Do we recommend a Purchase Plus Mortgage? 

Life is about gaining new experiences, learning new things, and adding skills to your tool belt. My wife and I had little experience with home renovations before this purchase. However, through our experience with the Purchase Plus mortgage, we learned a lot and will be more comfortable the next go round!

We hired a contractor to do most of the work but also pitched in to save some money and gain hands-on experience. We highly recommend this program to anyone looking to renovate an older home while enjoying the benefits of amortizing the costs over the length of their mortgage.

If you are interested in learning more about ‘Purchase Plus Improvements’ mortgages, I'd be happy to answer your questions or reach out to your broker/lender directly.

Completed renovations of basement in-law suite in Kamloops BC