BC Provides Down Payment Loans to First Time Buyers
Are You Looking to Buy Your First Home?
A new provincially backed loan program provides loans of up to $37,500 to help first time home buyers who have saved a down payment.
What the Program Offers
This amount is matched by the BC government because of the Home Owner Mortgage and Equity (HOME) Partnership program. The program provides a maximum of up to $37,500 or up to 5% of the purchase price, with a 25-year loan that is interest-free and payment-free for the first five years. No interest or principal payments are required in the first five years of the 25-year loans, as long as the home remains the buyer’s main residence. Purchase price must be $750,000 or less, excluding taxes and fees. After five years, buyers will make monthly payments at prevailing interest rates. The loan will be registered as a second mortgage.
The government is hoping to help first time home buyers get into a really tough real estate market:
“The province provided an example of a home purchase price of $475,000. The minimum down payment required for an insured first mortgage is $23,750. The new buyer would be able to receive up to an $11,875 interest-free loan for five years under the new program.
The loan support will run for three years and the province estimates about 42,000 new homebuyers will take advantage of the program.” Source: CBC
How and When to Apply
The time to apply for this program is after you have saved a down payment and have been pre-approved for a mortgage, but before you actually start making offers on properties.
The B.C. Home Owner Mortgage and Equity (HOME) Partnership supports eligible first-time homebuyers. To qualify for the program, all individuals with a registered interest on title must reside in the home and:
- Have been a Canadian citizen or permanent resident for at least five years
- Have resided in British Columbia for at least one year immediately preceding the date of application
- Be a first-time buyer who has not owned an interest in a residence anywhere in the world at any time
- Use the property as their principal residence for the first five years
- Purchase a home that has a purchase price of $750,000 or less (excluding taxes and fees)
- Obtain a high-ratio insured first mortgage on the property for at least 80% of the purchase price
- Have a combined, gross household income of all individuals on title not exceeding $150,000
- Have saved a down payment amount at least equal to the loan amount for which the buyer applied
For more information, and to apply visit the Province of BC’s website here:
