Most newcomers to Canada are still renting, and advisors can help
Why is saving for a down payment so difficult for newcomers to Canada?
Among newcomers who intend to buy but have not yet done so, 61 percent identify saving for a down payment as their biggest barrier. Getting a more stable or higher-paying job was cited by 50 percent. Building a credit score or credit history was flagged by 27 percent.
Building credit has been challenging for many, especially those who are new to Canada. Many newcomers arrive from countries where transactions are primarily cash-based. They may have sound finances but no Canadian credit file for lenders to assess.
Eunice Aranda, a sales representative with Royal LePage Benchmark in Calgary, points to credit as the first hurdle. “Building a Canadian credit history can be one of the first challenges newcomers encounter when preparing to buy a home,” she said. Many arrivals have strong savings but no borrowing record that Canadian lenders recognize. “Understanding that every credit decision can affect future purchasing power is incredibly important, especially in those first few years in Canada,” Aranda said.
Helping newcomer clients understand how Canadian credit systems work is a concrete, early-stage service for advisors. Research on how advisors can build lasting trust with new Canadian clients shows early engagement tends to translate into lasting loyalty.
What mortgage pathways exist for newcomers with limited credit history?
For clients not yet mortgage-ready through conventional channels, alternatives exist. CMHC provides mortgage loan insurance through its Newcomers program for eligible permanent and non-permanent residents. Where Canadian credit history is limited, an international credit report or a home-country bank reference may be accepted instead.
