West Lincoln and Smithville Mortgage Broker

West Lincoln at a glance

Benchmark price

$660,000

Property tax rate (approx.)

1.19%

Minimum down at benchmark

$41,000

Ontario LTT at benchmark

$9,675

West Lincoln is the township on Niagara's western edge, above the escarpment and south of Grimsby and Lincoln. Smithville is its main urban area, with municipal water and sewer and most of the township's subdivision homes. Around it are smaller communities such as Wellandport, Caistor Centre and Abingdon, and a large agricultural area. The composite benchmark is about $660,000.

The residential tax rate is approximately 1.19%, about $7,854 a year or $655 a month at the benchmark. Confirm the current rate and your assessment with the Township of West Lincoln.

Two markets: Smithville and the countryside

Smithville subdivisions

Young families come to Smithville for newer detached homes and townhouses at prices below Grimsby, within driving distance of Hamilton and the QEW corridor. Buying new from a builder qualifies for the 30-year insured amortization whether or not you are a first-time buyer, and first-time buyers of new homes may be eligible for the federal GST rebate and Ontario's matching HST rebate; confirm both with your real estate lawyer.

Rural West Lincoln

Outside Smithville, homes generally rely on private services: some have drilled or dug wells, and cisterns are common. Lenders typically require:

• a potable water test for bacteria, and for wells sometimes a flow test;
• a septic inspection ($400 to $800), with a holdback or decline possible if the system is failing;
• an appraisal that values the home and usually up to about 10 acres, with little or no value for barns, shops and outbuildings.

Agricultural zoning adds checks on second dwellings, severances and home businesses, so check the current township zoning by-law before you plan around one. A working farm needs agricultural lending, from lenders such as Farm Credit Canada or a credit union. See our rural cistern, well and septic guide and, for larger parcels, the hobby farm guide.

Self-employed trades and trucking

West Lincoln has many households where the income comes from a contracting business, an owner-operator truck or a small farm-related service. These borrowers often earn well but show modest taxable income, because write-offs reduce what appears on the tax return. That is the core problem, and there are three ways to approach it:

1. Prime lenders, documented income. A-lenders and credit unions typically average your last two years of income from your tax returns and notices of assessment. Some add back certain non-cash items. Incorporated owners can sometimes combine salary, dividends and retained earnings, depending on the lender and your accountant's statements.
2. Stated or reasonable income. Some lenders and insurers have programs for self-employed borrowers with a business history of two years or more, where income is assessed for reasonableness against your industry rather than taken only from the return. Expect a larger down payment or a higher rate.
3. Alternative lenders. B-lenders such as Equitable Bank or Home Trust look at bank statements and the overall picture. Rates are higher, terms are usually one or two years, and there is typically a disclosed broker fee of about 1% and often a lender fee. The plan is to move back to a prime lender once the tax returns support it.

Every file is different, and tax planning is a question for your accountant: lowering taxable income saves tax but also lowers what you can borrow. Our self-employed mortgage guide lists the documents to gather, and the B-lender page explains costs. Arrears to the Canada Revenue Agency must usually be paid or on a formal plan before any lender will fund.

Closing costs and qualifying income at $660,000

Run your own numbers in the payment and closing cost calculator or the affordability calculator. Nearby, compare Lincoln, Pelham and Wainfleet.