• New Rules For First Time HomebuyersNew Rules For First Time Homebuyers

    As everyone has probably already heard, the Canadian Government plans on introducing some New Rules For First Time Homebuyers thereby helping first time homebuyers afford a home.

    What Are The New Rules For First Time Homebuyers Again?

    There are 2 main points:

    1. Previously, the RRSPs limit that you could withdraw towards the down payment without being penalized was $25K. The new amount will be $35K.
    2. Additionally, an interest-free loan from the government that can be put towards the purchase. The loan will be 5% for existing homes and 10% for new homes. Thus, these New Rules For First Time Homebuyers are expected to offer some relief, make the mortgage more affordable and help these people qualify for a mortgage.

    Why Not Abolish The Stress Test?

    Why introduce New Rules For First Time Homebuyers rather than abolish the stress test? The quick answer: they’re afraid that if they did that, it wouldn’t be subtle enough and it would drive up house prices. Of course, this is what they were trying to avoid.

    CMHC Statement

    Today the CMHC (Canadian Mortgage and Housing Corporation) came out with a statement that predicts these new measures will result in house price increases between 0.2-0.4%. On the other hand, they believe that if they abolished the stress test completely, house prices would have increased 5-6x that amount.

    If you are a first time home buyer, come talk to us. We don’t pressure. We just advise!

    Robert Floris is a Mortgage Broker. His office is located at 651 Fennell Avenue East in Hamilton, Ontario. If you would like to speak with Robert, he can be reached at 905-574-9200 #215. Alternatively, you can contact Robert here.

    If you would like to apply for a mortgage online, please follow this link.

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