The Planholder must not be related to the mortgagor (i.e. borrower) by blood, marriage or adoption. The mortgagor cannot be a company owned or controlled by the Planholder or a relative of the Planholder.
Step #1: A Self-directed RRSP account is opened with the Trust Company, the administrators and trustee for the Planholder. The account will occur cost for the set-up and Trustee fees; however these fees are ultimately paid by the borrower.
Step #2: The Planholder’s current RRSP existing elsewhere are rolled over tax-free into the Self-Directed RRSP. The Planholder’s future RRSP contributions are made directly into the newly opened Self-Directed RRSP, and a top-up or new RRSP loan is made.
Step #3: We will inform the planholder of a mortgage opportunity. Upon acceptance of the offer the planholder will sign all the necessary documents.
Step #4: Upon all documents signed and accepted, the Planholder will authorize the trustee to release the required funds from the Self-Directed RRSP account to an appointed solicitor in trust for the selected mortgage on the subject property.
Step #5: 30 days after funding and every month (or quarter) thereafter, mortgage payments are automatically debited from the mortgagor’s bank account and deposited into the Self-Directed RRSP account by the trustee.
Step #6: The trustee sends out statements to the Planholder showing all deposits, withdrawals and administrative charges on the Self-Directed account.