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Effective September 2, 2019, the Government of Canada has introduced the First Time Home Buyer Incentive (FTHBI) to help qualified First Time Home Buyers (FTHB) purchase a home, making homeownership more affordable by reducing their monthly mortgage payment without increasing their down payment.  


The FTHBI is considered a Shared Equity Mortgage (SEM) where the Government of Canada has a shared interest in the borrower's property value. This program is available through the default insurers; Canada Mortgage Housing Corporation (CMHC), Genworth and Canada Guaranty. Borrowers will receive an incentive in the form of an interest-free loan towards their down payment:


·         5% for the purchase of a resale property OR

·         5% or 10% for the purchase of a new construction home


Program Eligibility


  • The borrower must be a Canadian Citizen, Permanent Resident or Non-Permanent Resident who is legally authorized to work in Canada.
  • At least one borrower must be considered a FTHB based on the qualifying criteria.
  • Property must be owner occupied and located in Canada.
  • Borrowers must contribute the minimum required down payment from traditional sources.
  • Default insurance premiums will be calculated based on the purchase price less the borrower's own down payment and the FTHBI amounts.
  • The loan has no monthly payment. Repayment amount will be based on fair market value to be determined at the time of repayment.

o   Repayment will be required when the property is sold or at the end of the 25-year term, whichever happens earlier.

o   Voluntary repayment of the full incentive can be made without any prepayment penalties.


Application Process Requirements


  • In addition to the signed privacy agreement and credit application, customer must provide a signed original or signed copy of the 'FTHBI Program Attestation, Consent and Privacy Notice' at the time of application. This form can be found on the FTHBI website.
  • Application must be submitted after September 2, 2019, and the closing date must be on or after November 1, 2019.

o   Only High Ratio mortgages (greater than 80% Loan-to-Value) are eligible and the borrower's annual qualifying household income does not exceed $120,000.

o   The combined mortgage loan amount and incentive cannot exceed four times the total annual qualifying income. To verify this, you can use the Government of Canada's online calculator tool.