First-time home buyers are now eligible for a great new incentive from the Government of Canada that reduces their monthly mortgage costs without increasing their down payment. It helps put new home buyers into the home they’ve always wanted, faster.
Dubbed the First-Time Home Buyer Incentive, it’s for people looking to get their first mortgage and buy their first home, loaning them 5 or 10 percent of the total value of their home. That could mean up to $50,000 to put toward your mortgage and make buying your dream home in Legacy that much easier.
How it Works
If you’re buying a brand-new home, you can receive either 5 or 10 percent of the total value of your home back as a loan from the government (only 5 percent on resale homes). This shared equity mortgage is designed to lower your monthly payments by as much as $340. The loan is interest free, must be paid back after 25 years or when the home is sold (whichever comes first), and there is no penalty on paying it back sooner. But when it comes time to sell your new home, the government is entitled to 5 or 10 percent of its fair market value at the time of sale.
Who is Eligible?
This incentive is available for first-time home buyers or those who have not occupied a home in the last four years that they or their current spouse or common-law partner owned. Individuals or households must make $120,000 a year or less (total household income pre-tax). Those experiencing a breakdown in a common-law partnership or marriage may also be eligible. In order to qualify for a mortgage you still need a minimum 5 or 10 percent down payment (10 percent for 3-4 unit properties only), and you must be a Canadian Citizen, permanent resident or if you’re not a permanent resident, you need to have legal authorization to work in Canada.
Your total borrowing (excluding the down payment) cannot exceed four times your total income. That means if you make $80,000 dollars a year, your total borrowing on the home you choose cannot exceed $320,000, or you’ll be ineligible for this program.
Is the First-Time Home Buyer Incentive Right For You?
If you qualify for the First-Time Home Buyer Incentive and could benefit from reducing your monthly mortgage payments by a few hundred dollars, this incentive could work out well for you. However, because this loan from the government will need to be paid back either in 25 years or when you sell your home, you need to factor that cost into your decisions.
Learn more at Placetocallhome.ca
Explore some of Legacy’s homes that are perfect for people interested in the First-Time Home Buyers Incentive.