I am a First Time Home Buyer, what Perks are Available to me?

Each First Time Home Buyer on title can withdraw up to $25,000 from their RRSP, withholding tax free. You have 15 years to repay withdrawals made from your RRSPs under the HBP. In each tax year, repay one-fifteenth of the total amount borrowed until your full amount owed is paid back to your RRSPs.

  • First Time Home Buyers’ Program Property Transfer Tax Exemption reduces or eliminates the amount of property transfer tax you pay when you purchase your first home. If you qualify for the program, you may be eligible for either a full or partial exemption from the tax. A full exemption is available on homes up to $500,000.
  • Be a Canadian citizen or permanent resident for the last five years
  • Have lived in British Columbia for at least the full 12 months preceding your application
  • Be a first-time homebuyer who has not owned an interest in a principal residence anywhere in the world at any time and has never received a first-time homebuyers’ exemption or refund
  • Purchase a home that is $750,000 or less.
  • Be eligible for a high-ratio insured first mortgage for the home
  • Other criteria are:
  • The combined, gross household income of all individuals on the title must not exceed $150,000.
  • The home being purchased must be used as the principal residence of all individuals on the title for the five years after purchasing.

What is the Mortgage Qualification Process?

  • Application – a full application is required to ensure we have covered all of the necessary questions involved in qualifying for a mortgage. The application will cover your source(s) of income, assets, liabilities, credit, address history and source of down payment. We will look at what you can qualify for based on your income and liabilities and what payments you are comfortable with. Once you’ve decided on a purchase price and have been pre-approved for a mortgage you can start looking for a home!
  • Once you find a home and have an accepted offer you always need to include a “subject to financing” clause. Even if you are pre-approved the Lender also has to approve the property and examine your income documents and complete a down payment verification. At this point you will also need to meet with your Broker to sign the mortgage commitment.
  • Once the financing is officially approved you can remove your subject to financing clause from the contract. The Lender will send the instructions to the Lawyer for you to sign and bring in the balance of your down payment.
  • During the time between subject removal and closing on your property remember not to make any changes to your financial situation. This is not the time to increase limits on credit cars or lines of credit or take on any new loans

How Much Down Payment do I need?

  • For an owner occupied purchase (including a home with a basement suite) you can buy a home with as little as a 5% down payment. For any down payment less than 20% a mortgage default insurance policy will apply (ie: CMHC). This amount is a sliding scale based on your down payment and can be added to the amount you are financing.
  • For a rental property you require a minimum 20% down payment.