416-727-7111
20th
Mar

Federal Budget is in and there are 2 Main Mortgage Impacts

Posted by Ali Broker ot 05:05 PM

Two interesting changes in the federal budget that pertain to our industry:

  1. RRSP maximum withdraw increased from $25k to $35k, monies must still be paid back in 15 years or unpaid funds are added to taxable income

  1. NEW CMHC “first time buyer incentive”…IF client is a first-time buyer and IF combined household income is less than $120k per year and IF purchase price is $500k or less, CMHC will provide “interest-free” loans to “top up” first-time buyers down payment. The client must have 5% down of their own money and then CMHC will “lend” an additional 5% down payment on a resale home and up to 10% on a newly built home. The thought here is that the larger total down payment will reduce the first time buyers monthly mortgage payment. The mortgage amount cannot be more than 4 times the annual household income. When the property is sold the “interest-free” loan is repaid. What we don’t know is IF CMHC will be entitled to any of the profits on a sale, this has not yet been clarified.

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