Scotiabank Total Net Worth Lending Program

The Scotiabank Total Net Worth Lending Program is designed to provide additional mortgage solutions to customers with moderate incomes who have a significant amount of verifiable liquid assets and strong credit scores. They have made recent updates to the qualifications from their original program release in 2019 which I wrote about here. If you are interested in the program have a review over the current qualifications (subject to change) and call me for more details!

Borrower Qualifications

• Canadian Resident, claiming taxes in Canada

• All account owners of the liquid assets must be on the mortgage

Asset Requirements

• Minimum liquid assets of $250,000

• Must have $1 in liquid assets for every $1 in mortgage needed above standard qualified amount (i.e. if you qualify for a $400,000 mortgage using standard debt servicing ratios but require a mortgage of $950,000, you must have verified liquid assets of $550,000 in addition to down payment)

• Assets must be unencumbered (not pledged as security for another credit facility)

• All account holders where assets are held must be on the mortgage

• No foreign income can be used

• No foreign assets can be used, except those expressly stated on the eligible asset list

Eligible Assets

• GIC

• TFSA

• ESOP

• Mutual Funds

• Chequing & Saving Accounts

• Stocks of a publicly traded Canadian or U.S company

• Stocks of a non-Canadian company owned within an investment account/portfolio held in a Canadian financial institution

• U.S Government T-Bills, Treasure Notes, and Treasury Bonds

• Canada/Provincial Savings Bonds

• Equity in existing properties being sold (sales closing after purchases are acceptable) A firm purchaseand sale agreement is required

• RIFs (discounted by 30%), only if RIF income is not used for income qualification

• Liquid assets held in holding companies (not Inc.), if the following requirements are met:

▪ Transactions and business deals are limited to activities within Canada

▪ Assets are liquid and align with the list of eligible assets

▪ All owners of the Hold Co must be on the mortgage applications (Articles of Incorporation are required)

• Retirement Accounts (discounted by 30% to account for withholding taxes)

Note: Locked-in accounts, margins accounts, panda bonds, cryptocurrency, and RESPs are not considered eligible assets

Eligible Properties

• Primary Residence

• Secondary/Vacation Properties

• Rental Properties

Amortization

• Maximum 30 years

Eligible Loan Purposes

• Purchase

• Refinance

• Switch and Switch with additional funds

Note: All transactions are uninsured only

Maximum Loan to Value Ratio

• 80% - If TDSR ≤ 60% (LTV sliding scales apply)

• 65% - If TDSR > 60% (LTV sliding scales apply)

Scotia Total Equity® Plan (Scotia STEP® Program)

• Maximum Scotia STEP® Global Limit is 80% of lending value

Documentation Requirements

• Standard income confirmation and documentation policies apply. Applications with $0 income or income solely from RRSPs are ineligible

AND

• Evidence that average liquid asset amount meets, or is in excess of, the liquid assets required, over a 90-day history of ownership (e.g. Annual Investment Statements, Quarterly Statements, Monthly Statements)

Note: The minimum requirement is the lowest amount on deposit during the 90-day history

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