First Time Home Buyers Incentive Program

(September 04, 2019 )

Received this information from Jennie Shandley -Mortgage Specialist with the Dreyer Group Mortgages Inc.

Good Morning,

As announced in the 2019 Budget, the Government of Canada is introducing a First Time Homebuyer Incentive (FTHBI) Program set to launch today.

The FTHBI Program allows eligible first-time homebuyers, who have the minimum down payment for an insured mortgage, to apply to finance an additional portion of their down payment through an incentive of either 5% or 10% secured by a shared equity mortgage with the Government of Canada (registered as a second mortgage). Purchase closing date must be on or after November 1, 2019.
For additional program related information, please visit the government’s dedicated website which includes program details, eligibility, tools and calculators for illustration purposes: or call the FTHBI hotline at 1-877-884-2642, or contact Jennie Shandley @ 604-836-3317

Some "need to know" facts for you:

  • 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
  • You do not need to actually be First Time Home buyer (call me for info or check on the Govt website)
If you meet these criteria, 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 homebuyers" 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 $400,000, or $20,000. 
  • If your home value increases to $500,000 your payback would be 5% of the current value or $25,000. 
  • You receive a 10% incentive of the home’s purchase price of $400,000, or $40,000 and your home value decreases to $350,000, your repayment value will be 10% of the current value or $35,000. 
NOTE: If your property value goes down, you are still responsible for repaying the shared equity mortgage based on the current home value at time of repayment.

If you have clients who you think may benefit from this program, I would be happy to go over the details and help them with an application.

Have a good day!

Jennie Shandley
Mortgage Specialist – Dreyer Group Mortgages Inc.
Member of the VERICO Brokers Network
Cell: 604-836-3317 Fax: 604-608-9307