Home Ownership Incentives (2020)

The first question is who the First-Time home buyer is:

• • You never purchase a home before
  • You did not occupy a home that you or your current spouse or common-law partner owned in the last 4 years.
  • You may breakdown a marriage or common-law partnership

The second question is how you can be qualified for first-time home buyer program:

• You have your minimum down payment
• Your total annual qualifying income doesn’t exceed $120,000
• Your total borrowing is no more than 4 times your qualifying income
• You or your partner are a first-time home buyer
• You are a Canadian citizen, permanent resident or non-permanent resident authorized to work in Canada

The First-time home buyer intensive program is a shared equity mortgage, the government shares the upside and downside of the property value, it also allows you to borrow %5 or %10 of the purchase price of a home and you have to pay back the same percentage of the value of your home when you sell it or within a 25 years, which ever happens first.

The Incentive program is like a second mortgage on your property, your first mortgage needs to be greater than 80% of the value of property and is subject to a mortgage loan insurance premium, also must be eligible through Canada Guaranty, CMHC Or Genworth.

The Insurance premium is based on the loan-to-value ratio of the first mortgage only. That is, the first mortgage amount divided by the purchase price and you don’t pay mortgage insurance on the incentive, it is already included with the total down payment. Your property must be in Canada and it should be suitable and livable for at least one year, basically the property you want to buy it can’t be your investment property.

The type of property is also a fact.

Residential properties can have 1 to 4 units and include:

• Single family homes
• Semi-detached homes
• Duplex
• Triplex
• Fourplex
• Town houses
• Condominium units
• Mobile homes

Now you almost understand about the Incentive program you can represent it to new home buyers and help them to have their own property.