First Time Home Buyer Incentive Program is a Government of Canada plan intended to help first time buyers purchase a home, by making it more affordable by reducing their monthly mortgage payment without increasing their down payment.
The FTHBI is a Shared Equity Mortgage where the Government of Canada has a shared interest in the borrower’s property value. This program is available through the default insurers; CMHC, Genworth and Canada Guaranty.
Borrowers will receive an incentive in the form of an interest-free loan towards the down payment:
5% for the purchase of a resale property OR 5 or 10% for the purchase of a new construction home.
In addition to the interest free down payment loan, the Government of Canada has also increased the eligible RRSP withdrawal amount from $25,000 to a maximum to $35,000 (link to Home Buyers’ Plan Website).