owning a home on ODSP
Jo
last week that she wants to buy a house because she's tired of
throwing her money away on rent. She also wants to put me on the title
so that when she dies I have a home to live in. At first, I thought
that I wasn't able to own a home because I was under the impression
that ODSP recipients aren't allowed any assets over $5k. However, now
I know that I can own a home as long as it's my "principle residence";
in some cases, you can even own a 2nd home (i.e. a summer cottage)
because you can argue that it's necessary for your "health and well
being" but this has to be approved by the "Director". I can even sell
a home and make a profit on it, but I have to buy another "principle
residence" with that money within 12 months before being penalized.
As a disabled homeowner, you can also qualify for "forgiveable loans"
from the CHMC ($19k if you live in northern Ontario) in order to make
modifications to your home so that you can live in it (i.e. ramps,
railings, bathroom & kitchen rennovations).
For those of you who don't think you can qualify for a mortgage, pay
attention: we went to see a "mortgage specialist" here in North Bay
(there are many mortgage brokers out there, take your pick...) Between
my mother's retirement pensions and my ODSP (which she can declare as
part of her total household income since we have a joint bank account)
we qualify for a substantial mortgage with no downpayment. Know why?
Because our government pensions are now considered "guaranteed income"
(in the past, they were not). So now we are house shopping.
Wanna buy a house? I suggest you go 50/50 on a house purchase; make
sure it's with someone you trust, though, and it doesn't have to be a
family member. It can be another ODSP recipient as long as your FICO
score is over 680 and you have an R1 credit rating (especially if you
want an "A" lender). If your FICO score and R-rating are less than
perfect, there *are* "B" and "C" lenders who will still loan you the
money but at a higher interest rate. However, once you repair your
credit, you can then transfer your mortgage to an "A" lender with lower
interest rates. So, you would only have to pay higher interest rates
for a couple years while you work out your credit problems. One last
thing: if you have a relative willing to co-sign for you, that will
help you get an even lower interest rate.
See a mortgage specialist you feel comfortable with -- DO NOT GO TO A
BANK for your mortgage, you will NEVER qualify. When you go to your
1st appointment, bring proof of last year's income (i.e. T-slips +
last month's bank statement). They will make you sign a form so they
can pull your credit report. You might have to open a joint bank
account with your co-applicant and have your ODSP cheque deposited in
it for at least one month so be prepared to wait a couple months to
qualify. (Once qualified, you can have your ODSP cheques deposited
into your own account.) You will be shocked and amazed at how much you
will qualify for with NO DOWNPAYMENT.
Just remember, you should always have at least $5k between the 2 of you
for emergency house repairs. And don't buy a house if the foundation &
roof are in need of immediate repair, the electrical is out-of-date and
it's heated with anything other than a moderate-efficiency gas furnace.
Everything else is cosmetic and can be dealt with over a period of
several years (i.e. new carpeting, new kitchen cabinets etc.) When you
make an offer to purchase, make it contingent on the following things:
1. financing 2. passing a home inspection (you have to pay for that
and it's about $300) and 3. the ability to purchase house insurance
right away.
Hope this helps. I am looking forward to being a homeowner, for the
first time in my life.
abrowne
See a mortgage specialist you feel comfortable with -- DO NOT GO TO A
BANK for your mortgage, you will NEVER qualify. When you go to your
1st appointment, bring proof of last year's income (i.e. T-slips +
last month's bank statement). They will make you sign a form so they
can pull your credit report.
Blab-away for as little as 1¢/min. Make PC-to-Phone Calls using Yahoo! Messenger with Voice.
Gem
our first house while on ODSP and our lender was the TD bank.
Do not go to Scotia for sure.. they do not consider ODSP income.
Dancing Sky
Myles and Deb Turcotte
willing to help us out with my husband on ODSP and I only worked about 4 hrs
per week.
Deb
Dancing Sky
For many people, buying a home is one of life's most exciting events, the fulfilment of a lifelong dream. For people with disabilities, the process is clogged with bureaucratic clutter created by preclusive business policies and discriminatory attitudes.
Bureaucratic procedure, however, is merely red tape that dares to be scissored. A fixed income is nonetheless an income; therefore, you qualify for a mortgage. This may be new but welcome news for recipients of government disability pensions who wish to own their own homes. Armed with information and fortitude, you can rise to the challenge and emerge victorious.
Ugly S.O.B.
----- Original Message -----
From: "Jo" <jmros...@cogeco.ca>
To: "ODSP Fireside" <odspfi...@googlegroups.com>
Sent: Wednesday, April 26, 2006 21:09
Subject: Reply: owning a home on ODSP
>
> FYI on owning a home while on ODSP: My mother (who is retired) decided
> last week that she wants to buy a house because she's tired of
> throwing her money away on rent. She also wants to put me on the title
> so that when she dies I have a home to live in.
That is not QUITE our situation. My mother in law bought a house for her
daughter to live in.
To make it a sort of legal loophole so there's no messy tax situation on her
passing, her daughter (now my wife, as well)
"mortgaged" the house. She is to pay 5% of the principle annually, with no
interest from now until bother of her parents die.
Then. The house is hers. Ours, I guess, but I vowed that if we ever were to
split up, I'd leave with what I brought and the house is hers, no messy
legal crap.
Meanwhile, I enter her life. So the assets are laid out like dirty laundry
to ODSP. The semi-annual mortgage payment has to be divied up twelve ways
to offer ODSP a monthly expense. And as you found, it's an "asset" but not a
LIQUID asset and doesn't count against you for ODSP purposes. So we've been
there done that and it works quite well.
> At first, I thought
> that I wasn't able to own a home because I was under the impression
> that ODSP recipients aren't allowed any assets over $5k.
A note to all: it really helps to read the legislation. You can probably get
useful leaflets at your library. Check out CLEO, Community Legal Education
Ontario or something like that. Try looking up their website. They also have
the leaflets online and they can send you printed copies for free. The
Ministry of Community and Social Services website has most of the
information they think you should know, and the actual ODSP Act is out there
as well to read. None of this costs you a penny so it's worthwhile reading
to know what is real and what is not.
However, now
> I know that I can own a home as long as it's my "principle residence";
And a car. Don't forget that you're entitled to own one car and not have it
count as "assets".
> For those of you who don't think you can qualify for a mortgage, pay
> attention:
As I described, we do not have a conventional mortgage, but I guess it IS
one nevertheless.
It is doable.
> Between
> my mother's retirement pensions and my ODSP (which she can declare as
> part of her total household income since we have a joint bank account)
> we qualify for a substantial mortgage with no downpayment. Know why?
> Because our government pensions are now considered "guaranteed income"
That's how I got to rent my first apartment with no hassles, describing to
the landlord that it is "guaranteed" income since there's nothing to be
"fired" from.
It helped big time, one of the few instances where having FBA was worth more
than a job.
> See a mortgage specialist you feel comfortable with -- DO NOT GO TO A
> BANK for your mortgage, you will NEVER qualify.
Heck I can't get a loan of any kind as my income is less than $20,000
> Just remember, you should always have at least $5k between the 2 of you
> for emergency house repairs.
Providing you have that kind of money. We're in debt so badly.
But we've had someone out there more or less to help in emergencies.
When it came to bathroom repairs, we were allowed to pay in installments,
equal payments no interest.
> Hope this helps. I am looking forward to being a homeowner, for the
> first time in my life.
You'll like it. Best wishes.
-Sean
Jo
necessarily *needed* a co-signer, it just helps you get an even lower
interest rate, especially when you're not making a downpayment. (No
downpayment = higher interest rates.) However, because my brother *did*
co-sign, we got an even better interest rate which will save us money
in the future. No, we didn't *need* him to co-sign but now we're going
to save thousands of dollars because he *did* co-sign.
I've heard horror stories about all the major banks, that's why I gave
the warning. You're lucky that the branch you went to had an
open-minded loan officer. Most of those guys are ignorant and
indifferent. Want proof? My Mom & I can't even get a used car loan
from a bank and yet we are about to buy our own house. Go figure.
Seeing a mortgage broker is the best option, in my opinion. The one
we're using works with 70 lenders so she found us several lenders with
different terms to choose from. But when you go to a bank, they only
work with one lender: themselves.
An insurance broker is also a good idea if you're pricing out life
insurance etc.
Jo
they will tell you EXACTLY what you have to do to resolve them. They
might even be able to consolidate all your debts into one payment by
getting you a short-term loan. They could also use your mortgage money
to pay them off. There are all kinds of tricks you can do. But start
the ball rolling NOW because it might take you a year or two to make it
a reality.