If you’re looking to buy your first home, you’ll appreciate the new equity-sharing homebuyer’s incentive announced recently by the federal government. Administered through CMHC (Canada Mortgage and Housing Corporation), the First-Time Home Buyer Incentive provides funding of 5% or 10% of your home purchase price.
To assist you in managing your cash flow, no ongoing monthly payments are required — instead, you repay the incentive at resale. For example, if you purchased a $400,000 home with a 5% down payment and a 5% CMHC shared equity mortgage ($20,000), the size of the borrower’s insured mortgage would be reduced from $380,000 to $360,000. This would help lower your monthly mortgage payment. The new incentive is expected to be implemented by the summer of 2019.
It was also announced that the tax-free amount that first-time homebuyers may withdraw from their RRSPs towards the purchase of their first home will increase from $25,000 to $35,000 (for withdrawals made after March 19, 2019).
For more information, check out savewith.caseracreditunion.ca/own-your-dreams/mortgage or contact your neighbourhood branch to set up a meeting with a Casera mortgage specialist.