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The First Time Home Buyer Incentive, explained

The First Time Home Buyer Incentive, explained

Posted by Graeme Maitland — filed in Real Estate Law

The Government of Canada has just made it easier to buy your first home. Through the First Time Home Buyer Incentive (FTHBI), owning a home has gotten easier with the government pitching in up to 10% of the value of the property.

What is the FTHBI?

The FTHBI is a program run by the Government of Canada to help first-time homebuyers reduce their monthly mortgage costs. They do this by providing a shared equity mortgage with the government of 5%-10%. The FTHBI is does not charge interest and does not require ongoing repayments.

How does the FTHBI work?

The FTHBI works by providing a shared equity mortgage with the government. This type of mortgage means that a lender (the Government of Canada) will agree to give you a loan alongside your main mortgage in return for a share of any profits when you sell your house or repay the loan. The benefit of this loan is that no ongoing repayments are necessary and it is not interest bearing, allowing you to repay it at any time without a pre-payment penalty.

How can I get the FTHBI?

To qualify for the FTHBI you must meet the following criteria:

  • you have the minimum down payment on the property you want to purchase
  • your maximum qualifying income is no more than $120,000
  • your total borrowing is limited to 4 times the qualifying income

In addition, you must meet on of the following qualifications:

  • you have never bought a home before
  • you’ve recently experiences a breakdown of marriage or common-law partnership
  • in the last 4 years you did not occupy a home that you or your current spouse/common-law partner owned

Once you qualify and meet the criteria, you can apply for the First Time Home Buyer Incentive.

If you qualify for the First Time Home Buy Incentive Program, or if you’re just buying or selling a home, contact a lawyer at Aarbo Fuldauer LLP in Calgary.

Address: 3rd Floor, 1131 Kensington Road NW, Calgary, AB, T2N 3P4

Phone: (403) 571-5120

Email: info@aflawyers.ca

The information in the blog is not legal advice. Do not treat or rely upon it as legal advice.  If you require legal assistance, please contact a lawyer.

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