RRSP First Time Home Buyers Plan Strategy
A First Time Home Buyer (FTHB) can feel the pinch when trying to save cash down. A great strategy is to take advantage of the home buyers plans (HBP) and leverage their RRSP’s towards savings!
If you have no RRSP’s saved. Seek a financial advisor (hey, like Ivan Dorie) who can help set you up an RRSP loan.
Let that loan seed for 90 days in your new RRSP account.
After 90 days you can now use that RRSP as cash down for your mortgage purchase. The best part of the RRSP is it is penalty free for 15 years under the home buyers plan. But you will need to top up that RRSP contribution when 15 years has come to an end. A win win scenario and helps encourage savings growth for yourself.
This may or may not work as a strategy in your first time home buyer purchase. One key factor for this being a solution to working is you have to remember: The RRSP contribution is a debt! So you have to qualify with this liability on the books in relation to your income level. One great feature however is RRSP First Time Home Buyers Plan Strategy qualifies for “AAA” credit low rates, there is no premium from banks; nice!
Contact Us today so we can see if this is a potential way to get into home ownership. But remember, never overstretch your self financially, this strategy is not for the faint of heart and if your liabilities are currently really high (auto loans, credit cards etc.). It is not a fit. But if your liabilities are low, you could find success!
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