If you're a first-time homebuyer, it's important to know about current programs available that you can apply for.
As a first-time buyer purchasing real estate, you may be eligible for rebates, such as the land transfer tax refund, tax-benefits that can help fund your down payment, or Government of Canada programs through Genworth or CMHC (Canada Mortgage and Housing Corporation) that allow you to put a minimum of a 5% down payment towards qualifying for your home. What is CMHC or Canada Mortgage and Housing Corporation? CMHC insurance is also called mortgage loan default insurance. In Canada, if you have less than a 20% down payment, your mortgage loan must be insured through one of the three mortgage insurance companies. They are CMHC, Genworth and Canada Guarantee. Contrary to some beliefs, this insurance does not protect you against defaulting on your mortgage loan. It is insurance to protect your financial institution in the event you default on your mortgage loan. It is offered so that financial institutions can have trust in providing a mortgage loan to borrowers who have a smaller down payment and are therefore, "higher-risk." Mortgage Default Insurance is blended into your mortgage payment and added to the principal balance of your mortgage loan and amortized out to 25 years. In Canada, you must have a minimum of 5% down. If the home's purchase price is over $500,000, then you will require 5% for the first $500,000 and 10% on the mortgage amount over and above $500,000 and not over $1,000,000. **There is currently no mortgage insurance available on real estate being purchased for over $1M. Who can use the RRSP Home Buyer Plan (HBP)? If you haven't purchased real estate within the last four years, you can qualify for the Government's Home Buyer Plan. Under this plan, you may qualify for up to $25,000 (which is exempt from tax but must be repaid in 15 years) to fund your downpayment and buying a home. It can be extremely beneficial to use the First Time Home Buyer's Plan as a Canadian. Borrowers are exempt for up to fifteen years from having to repay this RRSP loan after withdrawal. Do you meet the HBP eligibility conditions?
Land Transfer Tax As a first time home buyer, you are exempt from paying land transfer tax to up to $4,000. In Toronto, there is double land transfer tax - a provincial tax but also a municipal land transfer tax applies. GST/HST New Housing Rebate This is a rebate that offers money back to borrowers who have purchased a new development, re-build an existing property or re-construct a home that was destroyed due to a fire. You may be eligible for a rebate if you:
Start the process of owning your home today with a mortgage pre-approval. |
Resources for First Time Home Buyers:
How to participate in the Home Buyers' Plan (HBP) Land Transfer Tax Refund for First Time Home Buyers High-Ratio Mortgage Insurance (Genworth) |
First-Time Home Buyer (FTHB) Tax Credit
Source: CHMC The FTHB Tax Credit offers a $5,000 non-refundable income tax credit amount on a qualifying home acquired after January 27, 2009. For an eligible individual, the credit will provide up to $750 in federal tax relief. |
Home Buyers' Plan (HBP)
The Home Buyers' Plan (HBP) is a program that allows you to withdraw up to $25,000 in a calendar year from your registered retirement savings plans (RRSPs) to buy or build a qualifying home for yourself or for a related person with a disability. |
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GST/HST New Housing Rebate
You may qualify for a rebate of part of the GST or HST that you paid on the purchase price or cost of building your new house, on the cost of substantially renovating or building a major addition onto your existing house, or on converting a non-residential property into a house. |
Address411 Queen St.
Newmarket, ON L3Y 2G9 Second Location: Tottenham, Ontario Head Office: 15 Wertheim Court, Suite 210 Richmond Hill, Ontario L4B 3H7 Sarah A. Colucci, Mortgage Agent Lic. M14000929 Mortgage Edge, FSCO Lic. 10680 |
TelephoneDirect: 647-773-4849
Email: sarah.colucci@coluccimortgage.com |