Mortgage Services for First-Time Home Buyers 

Helping First-Time Home Buyers Navigate the Mortgage Process

Purchasing your first home is an exciting milestone, but it can also feel overwhelming. Many first-time home buyers face challenges such as understanding mortgage options, qualifying for financing, and gathering the necessary funds for a down payment.

At Invis, we specialize in guiding first-time home buyers through the mortgage process, ensuring you have the information and resources needed to make confident decisions. As an experienced mortgage broker, we provide access to multiple lenders, competitive interest rates, and expert advice on first-time home buyer programs that can help reduce costs and make homeownership more accessible.

Who Qualifies as a First-Time Home Buyer?

A first-time home buyer in Canada is someone who has not owned a home in the past four years. However, there are specific conditions that can affect eligibility:

• You qualify as a first-time home buyer if you have never owned a home before.
• 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 of the home purchase.
• If you are purchasing a home with a spouse or partner and they have not owned a home in the past four years, you may qualify.
• If you are recently separated or divorced, you may still be eligible for first-time home buyer programs, even if you previously owned a home with your former partner.

Understanding whether you qualify is essential, as it determines your access to first-time home buyer programs and financial incentives.

Benefits of Being a First-Time Home Buyer

Becoming a homeowner is a significant financial and personal milestone, and as a first-time home buyer, you can access several benefits and incentives designed to make homeownership more affordable and manageable. These benefits include government-backed programs, financial incentives, and strategic advantages that help you enter the housing market with confidence.

1. Access to the Home Buyers’ Plan (HBP)

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

Advantages of the HBP:

• The withdrawal is not subject to immediate income tax, allowing you to use the full amount towards your home.
• You have up to 15 years to repay the withdrawn funds back into your RRSP, making it a flexible financing option.
• If you repay the minimum required amount each year, you won’t face any penalties or additional taxes.
• By using your RRSP funds, you may be able to increase your down payment, which can reduce the amount you need to borrow and lower your mortgage insurance costs.

For many first-time buyers, the HBP is a valuable tool for making homeownership more attainable without having to accumulate savings in a traditional bank account.

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

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

Why the FHSA is Beneficial:

• Contributions are tax-deductible, reducing your taxable income in the year you contribute.
• Withdrawals for a home purchase are tax-free, making it similar to a TFSA but with the added tax-deduction benefits of an RRSP.
• If you don’t use the full $8,000 contribution limit in a year, you can carry forward unused amounts to future years.
• The FHSA can be combined with the HBP, allowing buyers to use both programs together for a larger down payment.

By utilizing the FHSA, first-time home buyers can take advantage of tax-free savings growth while building their down payment more efficiently.

3. Land Transfer Tax Rebates – Saving on Closing Costs

One of the most overlooked costs when buying a home is land transfer tax (LTT), which can add thousands of dollars to your upfront expenses. However, some provinces and municipalities offer rebates to first-time buyers to help offset these costs.

Examples of Land Transfer Tax Rebates:

• Ontario: Up to $4,000 in rebates.
• British Columbia: Full or partial exemptions for homes up to a certain price.
• Prince Edward Island: Full rebate on provincial land transfer tax for first-time buyers.

Land transfer tax rebates can significantly reduce closing costs, making it easier for first-time buyers to afford homeownership.

4. First-Time Home Buyer Tax Credit – Get Tax Relief

The First-Time Home Buyer Tax Credit provides a $10,000 non-refundable tax credit, which results in a tax reduction of up to $1,500. This tax credit is designed to help offset some of the legal and administrative costsassociated with buying a home, such as:

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

By claiming this credit, first-time buyers can lower their overall tax burden in the year they purchase their home, helping them save money during the transition to homeownership.

5. Lower Down Payment Requirements for First-Time Buyers

One of the biggest challenges for first-time buyers is accumulating a down payment. While repeat homebuyers often use the proceeds from selling their previous home, first-time buyers typically rely on personal savings.

Canada’s down payment rules for first-time buyers:

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

Why this is an advantage for first-time buyers:

• The 5% minimum down payment requirement makes homeownership more accessible.
• With government-backed mortgage insurance (CMHC, Sagen, or Canada Guaranty), first-time buyers can qualify for mortgages with a lower down payment.
• Programs like the Home Buyers’ Plan (HBP) and First Home Savings Account (FHSA) can be used to help reach the required down payment.

6. No Capital Gains Tax on Your Principal Residence

A major financial advantage of homeownership is that when you eventually sell your primary residence, any profit made is not subject to capital gains tax. This means that when the value of your home increases over time, you benefit from tax-free equity growth, which can be used for future investments or purchasing another property.

This is an important long-term financial benefit that allows first-time buyers to build wealth through real estate.

7. Stability and Predictability Compared to Renting

Owning a home offers greater financial stability compared to renting, especially in markets where rent prices are rising. Key advantages include:

• Fixed mortgage payments (for those with fixed-rate mortgages) provide long-term stability.
• Building equity instead of paying rent to a landlord.
• No risk of eviction due to landlord decisions (such as selling the property or converting it to another use).

For many buyers, owning a home provides a sense of security, stability, and financial predictability that renting does not.

8. Greater Control Over Your Living Space

As a homeowner, you have the freedom to:

• Modify and renovate your home to fit your preferences.
• Personalize your space without landlord restrictions.
• Upgrade your home to increase its value over time.

This level of control and independence is one of the biggest advantages of owning a home compared to renting.

9. Long-Term Investment Potential

Real estate is often considered a strong long-term investment because:

• Home values typically increase over time, leading to appreciation.
• You can build home equity through mortgage payments.
• Your home can serve as collateral for future investments or refinancing.

For first-time buyers, purchasing a home represents an important step toward financial stability and long-term wealth building.

First-Time Home Buyer Programs in Canada

Navigating the various first-time home buyer programs available in Canada can be complex, but they provide significant financial relief for those entering the housing market.

• Home Buyers’ Plan (HBP): Withdraw RRSP savings tax-free to use as a down payment.
• First Home Savings Account (FHSA): Save tax-free for a home purchase with tax-deductible contributions.
• Land Transfer Tax Rebates: Available in certain provinces to offset closing costs.
• First-Time Home Buyer Tax Credit: Provides tax relief on home purchases.
• Provincial and Municipal Grants: Many regions offer additional incentives to assist first-time home buyers.

Each program has specific eligibility requirements and application processes. Working with an experienced mortgage broker can help ensure you maximize your benefits.

How Much Down Payment Does a First-Time Home Buyer Need?

The minimum down payment required for a home purchase depends on the property’s price:

• 5% down for homes priced up to $500,000.
• 10% down for the portion of the home price above $500,000 and below $1 million.
• 20% down for homes $1 million or more to avoid mortgage default insurance.

Strategies to Save for a Down Payment

• Use RRSP Savings: Withdraw up to $60,000 tax-free through the Home Buyers’ Plan.
• Contribute to an FHSA: Save up to $40,000 tax-free for your first home.
• Take Advantage of Rebates: Utilize land transfer tax rebates to reduce upfront costs.

Saving for a larger down payment can lower your monthly mortgage payments and reduce the overall cost of homeownership.

Mortgage Pre-Approval: The First Step to Homeownership

A mortgage pre-approval is an essential step in the home-buying process, helping first-time buyers understand their budget and strengthen their purchasing power.

Benefits of Getting Pre-Approved

• Provides a clear picture of how much you can afford.
• Locks in an interest rate for up to 120 days.
• Shows sellers that you are a serious buyer with financing in place.
• Helps avoid unexpected issues during the mortgage approval process.

Tips for First-Time Home Buyers

• Understand Your Budget: Consider not only the mortgage payment but also property taxes, insurance, and maintenance costs.
• Improve Your Credit Score: Pay off outstanding debts and avoid new credit applications before applying for a mortgage.
• Compare Mortgage Rates: A mortgage broker can help you find the most competitive rates.
• Plan for Additional Costs: Homeownership includes expenses such as home inspections, legal fees, and closing costs.
• Use First-Time Home Buyer Programs: Take full advantage of the benefits available to you.

How Invis Can Help You Secure Your First Mortgage

At Invis, we specialize in helping first-time home buyers navigate the mortgage process. Our services include:

• Access to multiple lenders to secure the best mortgage rates.
• Expert guidance on first-time home buyer programs and financial incentives.
• Personalized mortgage solutions based on your financial situation.
• Step-by-step support throughout the application and approval process.

Find a Mortgage Broker Near You

If you are ready to take the first step toward homeownership, Invis is here to help.

• Use our search tool to find a mortgage broker near you or search for a specific mortgage expert.
• Get professional advice, compare mortgage options, and secure financing that meets your needs.

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