Starting in 2017 the British Columbia Government will be offering first time home buyers an interest free loan to help with the down payment in this insane BC real estate market. The program was introduced just when the Bank of Canada issued a report with a warning that Canadians are highly in debt and mostly due to extremely high housing prices. The announcement comes as housing costs in the province have skyrocketed, especially in Metro Vancouver where the average price on a single-family home in some places is now over $2 million.
2016 will show that Canada’s real estate market reached a record-high number of sales and prices and as a result made owning a home an unattainable dream for many.
According to BC’ Premier Christy Clark, the new loan program will not drive up prices in the real estate market significantly. According to the Premier, Canadians should be very concerned about the high debt levels across the nation, as Canada is one of the most highly indebted countries.
She claimed that while people need to really consider that, British Columbians need help and therefore the Government of BC can facilitate that by assisting with the down payment. “People need a partner in scraping together that first down payment,” she said Thursday, adding that “A home is a place where you live and raise your family and start your life.“ The program is meant to mostly help the middle class workers.
In this new program, the government of British Columbia will match down payments of up to $37, 500 for homes that cost $750,000 or less and are purchased by first time home buyers. It will start accepting applications online starting from January 2017.
The applicants would need to commit to living in the purchased home for 5 years. The loan would be interest free for the first five years and the repayment schedule lasting at current interest rates over the remaining 20 years. To become eligible, first-time applicants have to be pre-approved for an insured high-ratio mortgage for at least 80 per cent of the home’s purchase price. The buyer must be a Canadian citizen or a permanent resident who has lived in Canada for at least five years and have been in British Columbia for the last year or more.
A first time buyer for this purpose is a person who never owned a residence anywhere in the world not has received an first time buyer incentives before. Applicants must have a combined gross income of $150,000 or less in order to be eligible to apply for the loan.
Only fully completed applications with all supporting documents, such as proof of income, proof of status in Canada, identification and mortgage pre-approval will be considered. If the applicant qualifies and the application is accepted, they will be notified by email with the confirmation and a home buyer’s package. There they can find a detailed guide on all the steps you need to take in order to obtain the BC HOME Partnership loan.