Flexible Down Payment Options

A common reason many renters feel they can’t afford to purchase a home has to do with saving for a down payment. With so many expenses, it’s hard put money aside monthly. But there are many solutions available today that can help first-time buyers with their down payments.

Many lenders will allow for a gifted or borrowed down payment. Better yet, there are programs available from some financial institutions where they will offer a “free down payment” or a “flex down”. Of course, you will end up paying about 1% more in your interest rate, but the program will help you get in the homeownership door and start accumulating equity earlier. The only catch, however, is that you must remain with the original lender for the full initial five-year term or else you’ll have to pay the down payment back.

Under the RRSP Home Buyers’ Plan, first-time homebuyers can withdraw up to $25,000 from their RRSPs for a down payment – tax- and interest-free. And if there’s a couple making a home purchase together, they can each withdraw up to $25,000 from their RRSPs.

So, for those renters who are struggling to save up a down payment, choosing to talk to a mortgage broker  about downpayment options, can possibly get them into their own home faster.