At this time of year, you’ll see some great prices on Vacation Properties. Below you’ll find information on how Genworth Canada’s Vacation/Secondary Home Program works. You may be closer to affording that weekend retreat than you think!
Vacation Home Product: Clients dreaming of owning a lakeside retreat?
Owing a weekend retreat can seem like an unaffordable luxury, but with the help of Genworth Canada, you can make this dream a reality for your customers.
Genworth Canada’s Vacation/Secondary Homes Program was designed to help qualified homebuyers purchase a vacation property with affordable monthly payments and as little as five per cent down.
This product can be particularly appealing to prospective clients who currently rent a summer lakeside retreat or a cottage for winter ski trips. Informing them of options available through the Vacation Home product may help them turn that occasional holiday into equity for the long-term.
The product offers two options: one for year-round winterized cottages, and another for seasonal properties. Qualifying criteria vary per option, with more stringent credit and down payment requirements for seasonal properties.
Genworth Canada distinguishes these options as “Type A” and “Type B” properties.
Type A properties require only five per cent down, while Type B properties require 10 per cent down.
A Type A property must be zoned as residential, with a permanent foundation (even if it’s located in cottage country). And it must be winterized with a permanent heat source and year-round road access.
These properties are typically used as a secondary home, though in some cases they may be used as a vacation home. The home must be owner-occupied or occupied by an immediate family member; it cannot be used as a rental property.
A Type B property is closer to a true definition of a cottage. A Type B property might not have a permanent heat source — maybe it has a wood stove or a fireplace. The foundation might be floating and it may have seasonal road use. Properties with a main access road that isn’t plowed in the winter or are only accessible by boat would fall into this category.
Because this type of property tends to be more remote or rustic, there are more stringent requirements for homebuyers, including a higher minimum credit score of 650 for all applicants. There are also limitations on down payment sources for Type B properties.
For Type A properties, homebuyers can use traditional down payment sources, including personal savings, RRSP withdrawal or a gift from a family member, as well as existing home equity. For Type B properties, the down payment must come from the homebuyer’s own resources.
To help prospective homebuyers better understand this product encourage them to watch the Genworth Canada HomeOpeners® Vacation Home product video at www.genworth.ca/HOV. This short illustrated video will help them visualize how they can afford that vacation home they may have thought was out of reach.