For many Canadians, homeownership is a dream that seems out of reach. The high cost of living, coupled with an uncertain economy, can make it challenging to save up for a down payment. Fortunately, there are several down payment assistance programs available to Ontarians. Here are five things you may not know about these programs:
One of the first things to consider when buying a home is how much you need to put down. In Ontario, the minimum down payment required is 5% for homes that cost up to $500,000. For homes between $500,000 and up to $1 million, you’ll need to pay 5% on the first $500,000 and 10% on the remaining balance.
For homes over $1 million, the down payment is 20%. It’s important to keep in mind that while you can pay the minimum, it’s often encouraged to put down more to reduce your mortgage payments.
The Home Buyer’s Plan (HBP) is a government-run program that allows first-time homebuyers to borrow up to $35,000 from their registered retirement savings plan (RRSP) to put towards a down payment. To be eligible, you must meet RRSP withdrawal requirements and be a first-time homebuyer.
The Ontario land transfer tax can add up quickly when buying a home, especially for first-time buyers. Fortunately, the province offers a full or partial reimbursement of the tax to eligible buyers.
To qualify, you must be a Canadian citizen and a first-time homebuyer who intends to occupy the home as your principal residence within nine months of ownership. The maximum rebate amount is $4,000.
The Niagara Homeownership Program is a great option for low to moderate income households who are currently renting but want to own a home. The program offers a no-interest 20-year forgivable loan to qualifying individuals, and down payment assistance is 5%, up to a maximum of $19,537, on qualifying homes within Niagara.
Eligible homes include detached, semi-detached, townhomes, duplexes, and condos, but they must be modest in size and features.
The Home Buyer’s Tax Credit is a non-refundable tax credit designed to help first-time homeowners recover a portion of their down payment and closing costs. You can claim up to $5,000 on your personal tax forms when purchasing a qualifying home, whether it’s an existing home or a new build.
Persons with disabilities do not need to be first-time homebuyers to take advantage of this tax credit.
In addition to the programs listed above, there are several other down payment assistance programs available in Ontario. These include:
These programs all have specific eligibility requirements, so it’s essential to do your research and find the one that’s right for you.
Buying a home in Ontario can be challenging, but there are many down payment assistance programs available to make the process more accessible. Whether you’re a first-time homebuyer or someone who needs a little extra help, these programs can help you achieve your dream of homeownership.
Take the time to research each program and see which one is the best fit for you and your financial situation. With a little help, you can turn your dream of owning a home in Ontario into a reality.