Refinance with a rental unit

Clients in Mississauga recently asked us to refinance their mortgage at their renewal date. They have a rental suite with a separate entrance in their basement and our clients live in the upper two floors.

The mortgage lender asked the appraiser to provide a “market rent” dollar range for the basement suite. This is important because we need to include rental income in the application in order to qualify for the mortgage. However, we spoke with five different appraisal companies who all said they could NOT provide these numbers unless we can provide documentation from the City of Mississauga confirming that the secondary living unit is registered with the City.

In other words, a legal and conforming to code duplex. Otherwise, no can do! This is in fact pretty standard across the GTA.

The work around here is if our mortgage applicants have a rental agreement in place and they can provide at least three months’ bank statements showing proof of deposits. Until you have that, you need to wait if your unit is not registered with the City of Mississauga.