First Time Home Buyer Mortgage
Buying your first home in Vancouver is an exciting milestone, but it can feel a little overwhelming, too. Don’t worry—I've helped many first-time buyers navigate this process with confidence and ease. Together, we’ll take it step by step and find the mortgage solution that works for you.
How Much Can You Afford?
Before diving into the home-buying journey, it’s important to understand how much you can comfortably afford. Here are two key guidelines:
- Housing Costs: Your monthly housing expenses (mortgage payments, property taxes, utilities, etc.) shouldn’t exceed 32% of your gross monthly income.
- Total Debt Load: Your total monthly debt obligations, including your mortgage, should be less than 40% of your gross monthly income.
Living in Metro Vancouver can be pricey, so working with a mortgage broker can help you get a clear picture of what’s realistic for your budget.
Programs and Incentives for First-Time Home Buyers
As a first-time buyer, you’re eligible for several programs and incentives designed to make homeownership more accessible.
First-Time Home Buyer Incentive (FTHBI)
This federal program offers up to 10% of a new home’s purchase price or 5% for a resale home as a shared equity mortgage.
Eligibility Criteria:
- Your qualifying income must be less than $120,000.
- You need a minimum down payment of 5% for the first $500,000 of the home price and 10% for the portion above that.
- You can borrow up to four times your qualifying income.
The incentive helps reduce your monthly mortgage payments. Repayment is based on the home's value when you sell it or after 25 years—whichever comes first.
First Home Savings Account (FHSA)
The FHSA is a fantastic new tool for first-time buyers. It combines the benefits of an RRSP and a TFSA, allowing you to save up to $40,000 tax-free. You can contribute up to $8,000 per year, and withdrawals for your first home are tax-free.
RRSP Home Buyers’ Plan (HBP)
With the RRSP Home Buyers’ Plan, you can withdraw up to $35,000 from your Registered Retirement Savings Plan (or $70,000 as a couple) to use as a down payment.
How It Works:
- Withdrawals are tax-free, provided the funds are repaid within 15 years.
- To qualify, you must not have owned a home in the past four years.
The HBP is an excellent way to boost your down payment while minimizing your borrowing costs
CMHC-Insured Mortgages
If your down payment is less than 20%, you’ll need mortgage loan insurance through the Canada Mortgage and Housing Corporation (CMHC). This insurance protects lenders and enables you to secure a competitive interest rate despite a smaller down payment.
Steps to Getting Pre-Approved
- Check Your Finances: Know your income, expenses, and savings.
- Review Your Credit Score: Make sure your credit report is accurate.
- Prepare Your Documents: Have ID, proof of income, and details of assets and debts ready.
- Work with a Mortgage Professional: Get pre-approved to lock in an interest rate and show sellers you’re serious
Why Work with Me?
Buying your first home can feel overwhelming, but I’m here to simplify the process. As your mortgage broker, I’ll:
- Personalize Your Experience: Explain programs like the FHSA, HBP, and FTHBI and ensure you maximize savings.
- Shop Around for You: Access several top lenders to secure the best rates and terms.
- Be Transparent: In most cases, my services are free, and I’ll guide you every step of the way
Let’s Make It Happen!
Your first home is more than just a purchase—it’s an investment in your future. Contact me today, and let’s get started on finding the right mortgage solution for your dream home in Vancouver.
At Thiru Loganathan – Mortgage Master, I am committed to helping you find the perfect mortgage solution. Contact me today to learn more about how we can assist you in making your dream of homeownership a reality. Let me guide you home! To learn more about mortgage services in Metro Vancouver region, please click here. I look forward to hearing from you.
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Hi, I'm Thiru, a mortgage broker in Vancouver, BC. Whatever your mortgage goals, I can help you achieve them.
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