First Time Home Buyer Programs
There are a few different mortgage programs available to first time home buyers. These programs have been specifically designed to help make homeownership more affordable and ultimately, assist first time buyers with becoming homeowners sooner rather than later.
Home Buyers Plan (HBP)
The Home Buyer's Plan (HBP) is a program that allows your to withdraw funds from your registered retirement savings plans (RRSPs) to buy or build a qualifying home for yourself or for a related person with a disability.
How Does It Work?
The program will allow you to withdraw up to $35,000 from one or more of your RRSP accounts. The mortgage applicant must be the primary account holder of the RRSP in order for them to utilize this program.
Your RRSP issuer will not withhold tax on withdrawn amounts of $35,000 or less. However, it is important to note that some RRSP's such as "locked in" or Group RRSP plans do not allow you to withdraw funds from them.
Once the funds have been withdrawn and used to purchase a property, the repayment phase will be triggered. You will be required to pay back the full value that you have borrowed from the RRSP account over a 15 year period. For example, if you choose to withdraw $15,000 from your RRSP account, you will be required to pay back $1,000 per year over the following 15 years. If you forget to make a payment or choose not to pay the annual amount, you will be forced to claim the value as "income" and will be taxed.
Program Eligibility Requirements
How Does It Work?
The program will allow you to withdraw up to $35,000 from one or more of your RRSP accounts. The mortgage applicant must be the primary account holder of the RRSP in order for them to utilize this program.
Your RRSP issuer will not withhold tax on withdrawn amounts of $35,000 or less. However, it is important to note that some RRSP's such as "locked in" or Group RRSP plans do not allow you to withdraw funds from them.
Once the funds have been withdrawn and used to purchase a property, the repayment phase will be triggered. You will be required to pay back the full value that you have borrowed from the RRSP account over a 15 year period. For example, if you choose to withdraw $15,000 from your RRSP account, you will be required to pay back $1,000 per year over the following 15 years. If you forget to make a payment or choose not to pay the annual amount, you will be forced to claim the value as "income" and will be taxed.
Program Eligibility Requirements
- you must be considered a first-time home buyer
- you must have a written agreement to buy or build a qualifying home, either for yourself or for a related person with a disability
- you must be a resident of Canada when you withdraw funds from your RRSPs under the HBP and up to the time a qualifying home is bought or built
- you must intend to occupy the qualifying home as your principal place of residence within one year after buying or building it. If you buy or build a qualifying home for a related person with a disability, or help a related person with a disability to buy or build a qualifying home, you must intend that the related person with a disability occupies the qualifying home as their principal place of residence
- in all cases, if you have previously participated in the HBP, you may be able to do so again if your repayable HBP balance on January 1st of the year of the withdrawal is zero and you meet all the other HBP eligibility conditions.
First Time Home Purchase Program (FTHPP)
The Manitoba Metis Federation offers a First Time Home Purchase Program (FTHPP), which is delivered through the Louis Riel Capital Corporation (LRCC). This program is designed to help Metis citizens with their down payment and closing costs so that they can purchase their first home. The FTHPP contributes funds to a first-time home purchase in the following ways:
Similar to The F.T.H.B.I. Program, the FTHPP program also requires applicants to meet specific criteria:
In addition to the list above, there is also a list of properties that are considered "Eligible" and some that are not.
Eligible Types of Homes:
Ineligible Types of Homes:
If you feel that you meet the above criteria and are interested in taking part in the program, make sure you discuss this program with your mortgage specialist when applying for a mortgage pre-approval.
- 5% of the home purchase price up to a maximum of $15,000.00 towards the down payment.
- 1.5% up to a maximum of $2,500.00 towards closing costs (legal, land transfer, home inspection, etc.)
Similar to The F.T.H.B.I. Program, the FTHPP program also requires applicants to meet specific criteria:
- Applicant(s) residing in Manitoba for a minimum of 6 months
- Must provide proof of Metis citizenship with their application; ie. MMF Metis Citizenship Card or a letter from the MMF CRO department confirming the applicant's Metis Citizenship Card is in the process of being issued.
- Must be 18 years of age or older.
- Must be able to qualify for and obtain a mortgage from a mainstream or known financial institution. LRCC or the MMF reserves the right to review the terms and conditions of any first place mortgage financing.
- Priority will be given to those who are currently residing in social housing, and families escaping situations of abuse or violence.
- The forgivable loan amount must be registered on the title in second position at the applicants cost.
- The home being purchased must be for the applicant's primary residence.
- Applicant must not have ever owned a home.
- Applicants must not have ownership in any real estate (including land) with a market value of more than $30,000.
- Family/Household taxable income as stated from the CRA Notice of Assessments must be below $100,000.
- Applicants must have current combined liquid assets of less than $30,000.
In addition to the list above, there is also a list of properties that are considered "Eligible" and some that are not.
Eligible Types of Homes:
- Newly constructed homes with new home warranty proceeding as a turnkey purchase from a builder (deposits on new builds will not be funded and must be completed within a reasonable timeframe at the discretion of MMF FTHPP funder;
- Resale market homes, single family, side by side, townhouses, condominiums, multi-unit;
- Ready to Move Homes (RTMs) on permanent foundations;
- Conversions from non-residential use, that feature a new home warranty;
- Mobile homes on owned land, on a permanent foundation anchored to the property and acceptable to a financial institution for mortgage financing purposes;
- The home purchase price is to be governed by the applicants income and down-payment relevant to mortgage and debt payments.
- Maximum home purchase price $450,000.
Ineligible Types of Homes:
- Homes located in life-lease communities;
- Homes on leased or rented land;
- Mobile Homes in trailer parks;
- Self Builds or Progress Draw Constructions;
If you feel that you meet the above criteria and are interested in taking part in the program, make sure you discuss this program with your mortgage specialist when applying for a mortgage pre-approval.
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Castle Mortgage Group
100-1345 Waverley Street
Winnipeg, MB, Canada
R3T 5Y7
100-1345 Waverley Street
Winnipeg, MB, Canada
R3T 5Y7
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