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  • Writer's pictureChad Eliason

A Quick Guide to Purchase Plus Improvement Mortgages

So, you’ve found a house you love – but there’s a renovation project you know you’ll need to tackle to really turn it into your dream home. For example, maybe the house doesn’t have that perfect kitchen you wanted, or it’s not as much of an open concept layout that you desire. But you’re ready to move ahead with an offer anyway because the rest of the home is great.

The good news is that it’s okay if you end up making a compromise on the Shuswap home you decide to buy, because a purchase plus improvement (PPI) program could be a great fit for you to assist with the expenses of completing the home reno you have in mind.


With a PPI program, also known as a renovation mortgage, you can group home renovation expenses into the total amount of your mortgage. The benefits of doing this are:

· You’ll be able to take advantage of a lower interest rate on your renovation costs.

· You’ll only have one monthly payment, grouped into your mortggae.

· You’ll experience a less expensive way to complete renovations on your Salmon Arm home.


A conditional offer on a renovation mortgage program must be made through a lender that offers PPIs – and it also has to be insured by the Canada Mortgage and Housing Corporation (CMHC) or Genworth Canada. When you apply for the PPI program, you may need to include at least three contractor quotes that outline the work being done, and what the anticipated costs will be.

Next, the quotes are reviewed and an appraiser will assess the “as-is” value of the house, as well as what the “as-improved” value of the home would be after improvements. Lending is based on either the purchase price, or the improved value of the property; whichever is less.

It’s also important to keep a few other things in mind:

1. The renovation loan amount will be held in trust by your lawyers until the contracted work is complete, which means you’ll need to cover expenses up front.

2. Be mindful of using higher-end upgrades, as they may not result in a return on your investment when it comes to the market value realized from the completed work.

3. Most renovations must be finished within 90 days after the move-in date.

For more information on the Purchase Plus Improvements Program, head over to my website: Or if you’re ready to start the application, you can do so virtually on my website through the secure online application here.

I’ll be honest with you; while a PPI program is certainly cost-effective, it can be a relatively complicated application process, that’s why it’s best to work with an experienced mortgage broker. Connect with me today at and I’ll help you navigate the entire purchase plus improvement process, to ensure a smooth transaction.

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