Marie-France Lavigne and Michele Quinn – Dominion Lending Centres The Mortgage Source 10145 | FEDERAL BUDGET 2019: A CLOSER LOOK
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FEDERAL BUDGET 2019: A CLOSER LOOK

FEDERAL BUDGET 2019: A CLOSER LOOK

To begin with, these programs are not scheduled to begin until September of this year assuming no governmental changes.
I have taken the time to break down the math a little further to show the potential savings.
Bear in mind that the incentive funds of up to 10% on a new home and 5% on an existing home are merely an interest free loan that must be repaid upon sale of the property. This is for first time home buyers and household income cannot exceed $120,000 per year.
I will use the example that was in the budget release that illustrates the very maximum benefit available.

Details of the example

-New home purchase price: $400,000
-Household income: $120,000
-Down payment from the buyer: $20,000
-CMHC Incentive Loan: $40,000
-Assuming level fixed rate of 3.5% with an amortization of 25 years.

*Mortgage default insurance (CMHC) is required for a home purchase with less than 20% down payment. The insurance premium percentage decreases for each additional 5% down payment. The buyer with the standard 5% down mortgage pays a much higher premium.

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