The government’s new first time home buyer incentive program is coming out in September. It essentially allows anybody considered a first time home buyer to come up with a larger down payment from the government that is interest free. The government then takes a share of the profit or loss in the sale of your home down the road. While we haven’t received any notification from lenders on their adoption of the program we do have a few details that we can share with you on how the program will benefit first time home buyers.

In order to apply for this incentive you must meet the following requirements:

– You need to have the minimum down payment to be eligible
– Your maximum qualifying income is no more than $120,000
– Your total borrowing is limited to 4 times the qualifying income

If you meet these criteria, and you have a minimum of 5% down from your own resources, you can then apply for a 5% or 10% shared equity mortgage with the Government of Canada. A shared equity mortgage is where the government shares in the upside and downside of the property value.

How does it work?
The Incentive enables first time home buyers to reduce their monthly mortgage payment without increasing their down payment. The Incentive is not interest bearing and does not require ongoing repayments.

Through the First-Time Home Buyer Incentive, the Government of Canada will offer:
– 5% for a first-time buyer’s purchase of a re-sale home.
– 5% or 10% for a first-time buyer’s purchase of a new construction.

How do I know how much I have to pay back?
You can repay the Incentive at any time in full without a pre-payment penalty. You have to repay the incentive after 25 years or if the property is sold, whichever happens first. The repayment of the incentive is based on the property’s fair market value.

You receive a 5% incentive of the home’s purchase price of $200,000, or $10,000. If your home value increases to $300,000 your payback would be 5% of the current value or $15,000. You receive a 10% incentive of the home’s purchase price of $200,000, or $20,000 and your home value decreases to $150,000, your repayment value will be 10% of the current value or $15,000.

In addition, there is more information available on the government website at

If you need more information regarding mortgages or if you need any advice on your personal situation please contact our office at 604-556-3893 or email at

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