Buying a home is a big deal for everyone, but particularly daunting for the first time home buyer (FTHB). So many things to consider but for the FTHB, the upfront cost of buying a home, in particular the down payment, is usually the hardest part. There are several programs, plans and incentives that can help buyers with their decision, but for those that qualify, the First Time Home Buyers Incentive Program (FTHBI) can be part of the conversation. This assistance from the Canadian Government, in the form of a loan, will allow you to buy a home with a smaller deposit and will help to lower your monthly mortgage payments.
To be eligible for this type of financial assistance, in addition to qualifying as a FTHB, there are several other criteria you will need to meet including:
1. Your household income should be less than $120,000. This does include any investment or rental income.
2. You need to have the minimum down payment saved of 5% for the first $500,000 and the total down payment must be less than 20% of the purchase price.
3. The mortgage that you secure for your purchase, is less than four times your qualifying income. For example, if you make $120,000, then the most you can borrow top purchase your home is $480,000 (including the mortgage, mortgage insurance and the FTHBI amount).
Whether this is the right decision for you and whether you would be eligible for this type of assistance, a discussion with a mortgage specialist is a good place to start. For a complete explanation of the program and how it might work for you, click on the link below: