• Chartered Banks, Loan Corporations
• Trust Companies, Credit Unions
• Finance Companies, Pension Funds
• Life Insurance Companies, Private Individuals

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Provided you buy or build a qualifying home and meet all of the conditions for making a withdrawal under the Home Buyers’ Plan, you can use the particular funds you withdrew under the Home Buyers’ Plan for other purposes. (Not only down payment and closing cost, but for any other purpose you choose.)

This program is available to the first time home buyer only. (You are considered a first time home buyer if, at any time during the period beginning January 1, 1995 and ending 31 days prior to your withdrawal in 1998, you did not own a home while you occupied it as your principal place of residence)

This information is current throughout 1999. And the program has been extended indefinitely.

Repayment of the funds back to your RRSP can be made over 15 years. (The repayment period starts in 2001 and ends in 2015)

If the amount is not repaid in a year, that year’s repayment amount will be added to your income and taxed.

In order for the home to qualify it must be located in Canada and intended to be used as your principal residence.

This program may be used in connection with the 5% down program.

If you have any questions about the HBP program you can call the General Enquiries section of your local tax services office. You can find the address and telephone number listed under “Revenue Canada” in the Government of Canada section of your telephone book.

• Have your employer give you a letter on company letterhead outlining your name, position, gross annual income, and number of years employed with the company.
• If you are self-employed, you will need three years financial statements, and tax returns (together with official assessment from Revenue Canada).
• Social Insurance Numbers.
• At least 3 years history of residences and employers.
• Know your banking information (i.e. institutions name, address, type of accounts, account numbers)
• Know your assets and their value (i.e. cash amounts, stocks, bonds, RRSPs, car).
• Know your liabilities (i.e. car loan, credit card balances).
• Also, be sure and advise your Mortgage Intelligence Consultant about any past credit problems you may have had.
• Finally, write down a list of questions you would like to have answered.

To meet the Requirements of Canada Mortgage and Housing Corporation, GENCOR (GE Capital) and the Major Lending Institutions, on or before the issuance of a lending commitment you will be asked to provide "Confirmation of Down Payment" from Non-borrowed funds in one or more of the following forms.

• Down Payment from the Sale of an Existing Property: You will be required to provide a copy of the unconditional "Purchase and Sale Agreement" on your existing property. This needs to be accompanied by a copy of the statement of "Mortgage Balance" on any mortgages presently held against the property. The difference between the sale price and the mortgages owing will substantiate the funds available for your down payment.
   
• Down Payment from a Gift: All or part of the minimum equity requirement may be provided by way of a financial gift, as long as all of the following conditions are met:

  (a) the donor is an Immediate relative of the borrower;
  (b) the Approved Lender has verified that the money is a genuine gift; and
  (c) the Approved Lender has verified that the funds are in the borrower’s possession prior to the time of the application to CMHC or GENCOR for mortgage loan insurance.

• The Approved Lender will verify the authenticity of the gift by obtaining a written confirmation, signed by the donor and the borrower, which will include the following points:

  (a) the money is a genuine gift from the donor and does not ever have to be repaid;
  (b) no part of the financial gift is being provided by any third party having any interest (direct or indirect in the sale of the subject property)
  The Approved Lender is not required to forward this confirmation to CMHC, but is expected to retain the Information in its paper or electronic loan record.

• Down Payment from Your Own Resources: You must supply verification satisfactory to C.M.H.C. or GENCOR and the lender of accumulated savings from non-borrowed funds. This may be in the form of a copy of your bank book confirming a balance equivalent to your down payment including the amount of deposit confirming the savings of said amount for a period of not less than 3 months. Should a substantial deposit have been made recently, the source of such funds, i.e. Bonds, Stocks, G.I.C.’s or RRSP receipts will also be required.
• To avoid any delay in funding your transaction we suggest that you provide a form of the above noted confirmation at least 14 days prior to your closing date.

• The Offer
• The Deposit: Part of your down payment, a deposit is due upon acceptance of your offer.

Prior to Closing

• Home Inspection: Prepared by a qualified inspector to assess the property for defects and poor maintenance.
• Appraisal: Prepared by an appraiser chosen by the lender, by CMHC or GENCOR if the mortgage is insured by either company.

Closing Costs

• Legal Fee/Disbursements: Your lawyer will quote his fee for closing the purchase and mortgage(s) plus an approximation for his disbursements, which includes registration fees, courier costs, photocopies, etc. Ask for an estimate.
• Land Transfer Tax: See the chart enclosed in this package to calculate the Land Transfer Tax which is due on closing and reflected in the “Statement of Adjustments” which your lawyer prepares prior to closing day.
• Interest Adjustment: Monthly mortgage payments are due on the first of the month. Unless the closing date is the first of the month, you must prepay the amount of the interest accruing up to the 1st day of the following month, the Interest Adjustment Date.
• CMHC or GE & PST: If your mortgage is insured by CMHC or GENCOR the insurance premium will usually be added to the mortgage so it is not a cash requirement on closing. However, the premium is subject to 8% PST, and the tax must be paid on closing.
• Prepaid Expenses: If the Vendor has prepaid any other expenses such as utilities, water and sewage taxes, oil in tank or taxes, he must be compensated. This will be reflected in the Statement of Adjustments.
• Property Tax Hold-back: If the lender is collecting and paying property taxes you may be required to pay to the lender an amount to ensure sufficient funds are available to pay the next installment of property taxes when due.

Other Fees: Occasionally, a lender or the broker will charge a fee for providing the mortgage. If so, these costs should be disclosed to you at the time the Statement of Mortgage is issued to you.