Mortgage Services for First-Time Home Buyers 

Helping First-Time Home Buyers Secure Their Dream Home

Purchasing your first home is an exciting milestone, but it can also come with challenges. From understanding mortgage options to qualifying for financing and saving for a down payment, the process can feel overwhelming.

At Mortgage Intelligence, we specialize in helping first-time home buyers navigate the mortgage process with ease. As a trusted mortgage broker, we provide access to multiple lenders, competitive interest rates, and expert guidance on first-time home buyer programs designed to make homeownership more accessible.

Whether you are just starting your homeownership journey or need personalized mortgage advice, our team is here to assist you every step of the way.

Who Qualifies as a First-Time Home Buyer?

In Canada, a first-time home buyer is typically someone who has not owned a home in the past four years. However, there are specific qualifications that determine eligibility:

• If you have never owned a home before, you qualify as a first-time home buyer.
• If you have not owned a home in the past four years, you may still be eligible. The four-year period is calculated from January 1 of the year you purchase your home.
• If you are purchasing a home with a spouse or partner who has not owned a property in four years, you may qualify.
• If you are recently separated or divorced, you may still be considered a first-time home buyer, even if you previously owned a home with your former spouse.

Understanding your eligibility is crucial, as it determines access to various first-time home buyer programs and financial incentives.

Benefits of Being a First-Time Home Buyer

Buying your first home comes with unique financial advantages, including government-backed programs, tax incentives, and down payment assistance. These benefits make homeownership more affordable and provide long-term financial stability.

1. Home Buyers’ Plan (HBP) – Withdraw RRSP Savings Tax-Free

The Home Buyers’ Plan (HBP) allows first-time home buyers to withdraw up to $60,000 from their RRSPs tax-free to use as a down payment.

Key Benefits of the HBP:

• The withdrawal is not subject to immediate income tax, allowing you to use the full amount toward your home.
• You have up to 15 years to repay the withdrawn funds to your RRSP.
• By increasing your down payment, you can reduce your overall mortgage amount and lower your mortgage insurance costs.

For many first-time buyers, the HBP is a valuable tool to increase purchasing power without needing to accumulate traditional savings.

2. First Home Savings Account (FHSA) – Tax-Free Savings for Your First Home

The First Home Savings Account (FHSA) is a tax-free savings account designed specifically for first-time home buyers. It allows you to contribute up to $8,000 per year, with a lifetime contribution limit of $40,000.

Why the FHSA is a Great Option:

• Contributions are tax-deductible, reducing your taxable income in the year you contribute.
• Withdrawals are tax-free when used for a home purchase.
• If you do not use the full $8,000 annual contribution limit, you can carry forward unused amounts.
• The FHSA can be combined with the HBP, allowing buyers to use both programs together for a larger down payment.

By leveraging the FHSA, first-time buyers can accelerate their home savings while benefiting from tax advantages.

3. Land Transfer Tax Rebates – Saving on Closing Costs

Many first-time home buyers overlook land transfer tax (LTT) as a significant upfront cost. However, some provinces and municipalities offer rebates to first-time buyers, helping reduce closing costs.

Examples of Land Transfer Tax Rebates:

• Ontario: Up to $4,000 in rebates.
• British Columbia: Partial or full exemptions for eligible first-time buyers.
• Prince Edward Island: Rebates on the provincial land transfer tax.

These rebates help lower the financial burden of buying a home.

4. First-Time Home Buyer Tax Credit – Reduce Your Tax Bill

The First-Time Home Buyer Tax Credit provides a $10,000 non-refundable tax credit, which translates to up to $1,500 in tax relief. This tax credit is designed to help cover legal and administrative costs, such as:

• Legal fees
• Home inspections
• Land transfer taxes
• Mortgage application fees

By claiming this tax credit, first-time buyers can reduce their overall tax liability, making homeownership more affordable.

5. Lower Down Payment Requirements

First-time buyers benefit from lower minimum down payment requirements compared to other buyers.

Down Payment Requirements in Canada:

• 5% down payment for homes up to $500,000.
• 10% down for the portion of a home price between $500,000 and $999,999.
• 20% down payment required for homes $1 million or more to avoid mortgage default insurance.

With government-backed mortgage insurance (CMHC, Sagen, or Canada Guaranty), first-time buyers can qualify for mortgages with a lower down payment and competitive interest rates.

Mortgage Payment Calculator 

Plan Your Mortgage Payments with Confidence

Understanding your monthly mortgage payment is a critical part of planning your home financing. Whether you are purchasing a new home, refinancing, or considering different mortgage terms, knowing what your monthly costs will be helps you budget effectively and make informed financial decisions.

At Mortgage Intelligence, our mortgage payment calculator allows you to estimate your potential mortgage payment based on your loan amount, interest rate, and amortization period. By adjusting different financial factors, you can explore multiple mortgage scenarios and determine the best fit for your budget.

What Is a Mortgage Payment Calculator?

A mortgage payment calculator is a tool that helps homeowners and homebuyers estimate their monthly mortgage payments based on key financial inputs. It takes into account the home price, down payment, interest rate, amortization period, and payment frequency to give you a clear understanding of your mortgage obligations.

Using this calculator can help you:

• Determine affordability – Understand how much home you can afford based on your financial situation.
• Compare different loan structures – Test various down payments, interest rates, and amortization periods to see their impact on your payments.
• Plan for homeownership costs – Ensure that your monthly mortgage payments align with your budget.
• Assess refinancing options – See how a different loan structure could lower your monthly payment.

First-Time Home Buyer Programs in Canada

For first-time home buyers, the Canadian government and several provinces offer a variety of programs, tax credits, and incentives to make homeownership more affordable. These programs are designed to assist with down payments, reduce closing costs, and provide tax advantages that ease the financial burden of purchasing a first home.

1. Home Buyers’ Plan (HBP) – Using RRSP Savings for a Down Payment

The Home Buyers’ Plan (HBP) is a federal program that allows first-time buyers to withdraw up to $60,000 from their RRSPs tax-free to use as a down payment. This program provides flexibility for buyers who have been saving for retirement but want to use some of those funds to invest in homeownership.

How It Works:

• The withdrawal is not taxed, as long as it is repaid within 15 years.
• Payments back into the RRSP begin the second year after withdrawal and are spread over 15 years.
• The plan can be used in conjunction with other first-time home buyer programs, such as the First Home Savings Account (FHSA).

Who Benefits the Most from the HBP?

• First-time buyers who already have savings in their RRSP and want to leverage those funds for a home purchase.
• Buyers looking to increase their down payment to reduce their mortgage amount and monthly payments.

The HBP helps reduce the upfront cost of purchasing a home while allowing buyers to repay the funds gradually, making homeownership more financially manageable.

2. First Home Savings Account (FHSA) – A New Way to Save for a Home

The First Home Savings Account (FHSA) is a relatively new program that combines the benefits of a Tax-Free Savings Account (TFSA) and a Registered Retirement Savings Plan (RRSP). This account allows first-time buyers to save up to $40,000 tax-free toward a home purchase.

Key Features of the FHSA:

• Contributions of up to $8,000 per year (with a lifetime cap of $40,000) are tax-deductible.
• Funds grow tax-free and can be withdrawn tax-free when used for purchasing a home.
• If a buyer does not purchase a home, they can transfer the funds into their RRSP without tax penalties.

Why the FHSA is a Great Tool for First-Time Buyers:

• Encourages tax-free savings growth, allowing homebuyers to accumulate funds faster.
• Provides an alternative to an RRSP withdrawal, offering more flexibility without the need for repayment.
• Can be combined with the HBP, allowing first-time buyers to use both programs together for a larger down payment.

This program is ideal for younger buyers who are planning for homeownership in the near future but want to maximize their savings potential in a tax-efficient manner.

3. Land Transfer Tax Rebates – Reducing Closing Costs

Land transfer taxes (LTT) are one of the largest upfront costs for homebuyers. Fortunately, several provinces and municipalities offer land transfer tax rebates to first-time home buyers, significantly reducing these costs.

Provincial Land Transfer Tax Rebates:

• Ontario: Up to $4,000 in rebates on land transfer tax.
• British Columbia: Full or partial exemption on property transfer tax for homes up to a certain value.
• Prince Edward Island: A full rebate of the provincial land transfer tax for first-time buyers.

Municipal Land Transfer Tax Rebates:

• Toronto offers an additional rebate of up to $4,475, reducing the municipal land transfer tax burden.

By taking advantage of these rebates, first-time home buyers can reduce their closing costs, making it easier to afford their first home.

4. First-Time Home Buyer Tax Credit – Saving on Taxes

The First-Time Home Buyer Tax Credit is a non-refundable tax credit designed to help offset some of the costs associated with purchasing a home.

How It Works:

• The program offers a $10,000 tax credit, which translates into $1,500 in tax relief.
• This credit helps cover expenses such as legal fees, home inspections, and land transfer taxes.
• Available to all first-time home buyers, as long as they meet the eligibility criteria.

Who Benefits from the First-Time Home Buyer Tax Credit?

• Buyers looking for a tax break to help offset closing costs.
• Those purchasing their first home in Canada, regardless of whether they use other government programs.

This credit is an easy way for first-time buyers to save money on taxes, making homeownership more affordable.

5. CMHC-Backed Mortgage Insurance – Low Down Payment Options

For buyers who cannot afford a 20% down payment, the Canada Mortgage and Housing Corporation (CMHC) offers mortgage default insurance, allowing homebuyers to secure a mortgage with as little as 5% down.

How CMHC Mortgage Insurance Works:

• Available for homes priced under $1 million.
• Enables buyers to purchase a home with as little as 5% down, rather than needing a full 20%.
• The premium is added to the mortgage and paid overtime, keeping upfront costs lower.

Who Should Consider CMHC Mortgage Insurance?

• First-time buyers who do not have a large down payment saved but want to enter the housing market sooner.
• Those looking to benefit from competitive interest rates, as insured mortgages often come with lower rates.

6. Provincial and Municipal First-Time Home Buyer Grants

In addition to federal programs, some provinces and municipalities offer additional first-time home buyer grants to help with affordability.

Examples of Provincial First-Time Home Buyer Grants:

• Nova Scotia: Offers down payment assistance loans for first-time buyers.
• British Columbia: Provides low-interest homeownership loans for qualifying buyers.
• Manitoba: Provides grants and rebates for energy-efficient home purchases.

Each province has its own unique programs that can help reduce costs and make homeownership more accessible.

Mortgage Pre-Approval: The First Step to Buying a Home

A mortgage pre-approval is essential for first-time home buyers as it:

• Confirms your borrowing limit and purchasing power.
• Locks in a competitive interest rate for up to 120 days.
• Strengthens your offer when making a home purchase.

At Mortgage Intelligence, we simplify the pre-approval process, helping you secure financing with confidence.

Find a Mortgage Broker Near You

If you are ready to take the next step toward owning your first home, Mortgage Intelligence is here to help.

• Use our search tool to find a mortgage broker near you or search for a specific mortgage expert.
• Receive professional guidance, compare mortgage rates, and access first-time home buyer programs.
• Work with a trusted mortgage broker to find a financing solution tailored to your needs.

Start your home-buying journey with expert support. Find a Mortgage Broker today and take the first step toward homeownership.