Case Study 7

Purpose

• Applicant wants to purchase home while away from work on maternity/paternity leave
• Recently seperated from spouse and currently renting apartment

Income and Debt Servicing

• Stable salaried positions earning $55,000
• Employment verified by employment letter, pay stub, and verbal confirmation by employer
• $1.5K in monthly child and alimony support
• $541 in monthly Canada Child Benefits
• GDS/TDS is 39/39% with a stressed TDS of 46% using the mortgage rate plus 200bps

Mortgage Details
LTV	80%
Property Value	$400,000

GDS/TDS Calculation Salaried Income (Maternity/Paternity Leave) 100% $55,000 Additional Income Sources Child and Alimony Support 100% $18,000 Canada Child Benefits 100%  $6,492  $79,492 GDS/TDS 39/39% Stressed TDS 46%

Credit

• 550 Beacon
• Payments and bills were missed during the difficult period leading up to the applicant's divorce
• Excellent mortgage repayment history on previous home

Property

• $400,000 property value
• Good condition, well maintained property in suburban area

Down Payment

• $20K down payment from client's own savings
• $60K from the seperation settlement 

Deal Rationale:

Client was offered a 1 year mortgage at 80% LTV. The client was able to purchase a new home to raise their child in. 

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