Mortgage offer seals deal for investor

Developer's 1.99% vendor-take-back incentive convinces Markham mom to buy Pickering condo

- TRACY HANES

It’s been very expensive to get into the housing market and the dream of buying a home has appeared unattainable for many. What can you do to be able to purchase a house? In the ‘Affording a Home’ series, we look at different ways others have done it and at resources that can help.

Michelle Lat Barbosa, who lives in Markham in a semi-detached house with her husband and two kids, was looking to make an additional investment in real estate. It turns out she picked a good time to do so, as developers are offering incentives to sell units. So she took advantage of one and got herself a condo.

Lat Barbosa, head of operations for the MBE group of companies, hadn’t been interested in buying a condo. But her broker told her about The Grand, the latest building in a master-planned condo community in Pickering, that offered an attractive incentive.

“What made me change my mind was that it offered a 1.99-per-cent vendor-take-back mortgage for three years,” she says. “The interest rate has a big impact on your monthly payments, especially when it’s now around seven per cent.”

At a bank rate of 6.95 per cent, a $600,000-mortgage on a three-year term, amortized over 25 years, would have a monthly payment of $4,183.99. For a 1.99-per-cent mortgage of $600,000, set up on the same basis, the monthly payment would be $2,537.81 per month.

That’s a saving of just shy of $1,650 a month.