First-Time Buyers represent the largest group of purchasers in today's real estate market. Recognizing this, Lenders and Insurers have developed progressive ways to allow for many Canadians to purchase their first home, which would otherwise not have been possible under traditional programs.
The most common program utilized today by First-Time Buyers is the 95% high-ratio financing program through both the Canadian Mortgage and Housing Corporation (CMHC), and Genworth Financial (formerly GE Mortgage Insurance). Learn more about High Ratio Mortgage Insurance.
There are other programs available for First-Time Buyers in order to assist them with the purchase of their first home. Applicants are often enticed by some lenders with five percent down by offering cash back programs for the down payment or for the purchase of appliances etc.
Just be aware that these mortgages are offered at significantly higher than discounted rates, and the cash back is pro-rated in the case that you re-finance your mortgage.
There are also programs available through Genworth Financial and secondary mortgage lenders through a self-insured program, that allow for nintey-five percent financing, with higher premiums for the greater risk they take on these types of transactions.
These can vary significantly and applicants should consult with a Mortgage Broker for details on how these programs work. CMHC also permits first-time buyers to borrow their 5% from any other source under certain conditions.
The Home Buyers' Plan (HBP) is a program that allows you to withdraw up to $25,000 (after January 27, 2009), from your registered retirement savings plan (RRSPs) to buy or build a qualifying home for yourself or for a related person with a disability. Click here to learn more about HBP.
IMPORTANT NOTE: Don't forget to ask us about how you may qualify for FREE land transfer tax as a First-Time Home Buyer.
*On approved credit only, (OAC). Fees may apply in some circumstances on unqualified transactions.
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