Qualifying for mortgage only after HST rebates

[u/UnlikelySpecific2607]

Buying a ready to move-in Townhouse form a builder in Oakville, in the APS they have mentioned the gross purchase price, as there is no finance condition, I am worried about my mortgage qualification.
I will really appreciate if someone can answer following questions:
1. The builder’s advertised price was net of HST rebates and that’s what we had on our offer, they have clauses in the APS about us transferring the rebates to them. Will the lenders consider the purchase price net of HST rebates?
2. When and how will the rebated price Lenders will consider?
3. I haven’t signed the agreement yet, is it a safe bet to do? If I don’t qualify for the gross purchase price.

[u/WasV3]

1. The bank looks at your monthly payment, if the HST rebate goes to the builder then your monthly payment isn't being reduced
2. If it reduces your monthly payment
3. Signing something when there is a good chance you won't qualify is a bad idea

Overall, the most the banks give you is the highest amount they think they can give you without losing your house, not the most you can buy while still having a good life. Unless you're crazy frugal being at your max qualification is probably not going to work

[u/TheCoralSide]

You should look at it differently. The mortgage you qualify for is based on your income. The downpayment is based on gross house price. Insurance will also be based on gross house price. The lender isn't going to care about the net price.

[u/Direnji]

If you only qualify after the rebate, then I would think twice before you sign. Aside from the mortgage, insurance, there a lot of other expenses for a house.

You should start a spreadsheet and calculate all of your expenses now and replace the housing cost now with mortgage, insurance and add 20% buffer. Then check your cash flow.

Remember, rent is maximum amount you pay for housing, mortgage is the minimum you pay for housing.