Home Buyer's Plan

First time buyers may borrow a maximum of $20,000.00 from their RRSP account under this plan. The funds must have been in your RRSP account for at least 90 days prior to withdrawal to be eligible under the program.

Provided you buy or build a home and meet all the conditions for making a withdrawal under the Home Buyer's Plan, you can use the funds for other purposes that you choose. Many people do not know this. For example; your RRSP funds can be used not only for the down payment of your home. Your RRSP can also be used for furniture, closing cost such as legal and moving expenses.

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 as your principal residence).

This information is current and the program has been extended indefinitely. Repayment of the funds back to your RRSP can be made over a 15 -year repayment period. The repayment is calculated by dividing the amount borrowed by the number of years of repayment. You are allowed a 2- year grace period before repayment begins. If the amount is not repaid in any given year, that year's repayment amount will be added to your income and taxed. If you repaid more in any given year, Canada Customs and Revenue Agency would take the outstanding balance and divide it by the number of years left to repay. This would now be your new minimum annual repayment.

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

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

If you have other questions about the Home Buyer's Program you can call the Canada Customs and Revenue Agency.