First Time Home Buyer Incentive (FTHBI)
We love to see new programs launched to help first-time buyers make their first real estate purchase. The good news is that effective, Sept. 2 2019, a new first-time home buyer Incentive program has been introduced. Here some of the details you’re going to want to know.
What is it?
This program provides first time buyers with an interest-free loan that they can use towards the purchase of their first home. The loan is up to 5 % of the purchase price for resale homes and 10% for new construction homes. The loan is a second mortgage on the property where there are no regular principal payments.
Loan Repayment
Borrowers must pay the loan after 25 years or once the home sells – whichever happens first. You can also pay back the loan early without penalty. The amount borrowers owe may increase or decrease depending on how the value your home changes over time.
Program Restrictions
The loan comes with restrictions. The maximum qualifying income of the buyer must be no more than $120,000. This is the combined income of the buyers. So if a wife and husband plan to apply for the mortgage. It is the combined income of both that cannot be over $120,000
The maximum amount you can borrow is limited to 4 times our qualifying income.
First-Time Home Buyer Incentive – Where it fits
The first time home buyer incentive is particularly great for first-time buyers that live in smaller markets across the country where home prices are below the $565,000 max. Unfortunately, is our market here in Toronto, this first time home buyer incentive program will have little impact helping get more buyers into the market in a hone where they want to live.
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Need help to figure out how this impacts you? Let’s start a conversation.
Let’s set up a time to chat about your circumstances so we can help guide you through how to get the most from the incentives.
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