Canadians Buy United States Real Estate
With the value of the Canadian dollar hitting a 13-year low this year, Canadians who call Florida home are facing high costs on everything from groceries to rent. However, it's still a great time for Canadians to invest in U.S. realestate-as long as they finance it.
That's because, for Canadians, cash typically comes from equity in an existing Canadian property, cashing out investments or using savings, all of which require currency exchange. Financing empowers buyers to avoid the significant foreign exchange cost. Here are tips about the differences between their buying in the United States and Canada.
TIMING. While it takes only a few days to apply for and secure a mortgage in Canada, the process is longer in the United States, where it typically takes 45 days.
DOCUMENTATION. Securing a U.S. mortgage requires more documentation than in Canada due to highly regulated environment. For most U.S. mortgages, more than 10 documents are required, compared to fewer than five in Canada.
MORTGAGE INTEREST. U.S. mortgages are compounded monthly as oppossed to biannually in Canada. This may mean that the interest paid on a U.S. loan will be slightly higher than on a comparable Canadian loan.