27 Jun

Can Child Tax Credit Income Be Used To Qualify for a Mortgage?

Mortgage Tips

Posted by: April Hopfner

If you’re growing your family, chances are you may need more space! You might be looking to upgrade to a larger home, but you’re wondering what income can be used to qualify. If you’ve asked your bank, they may have told you that the Child Tax Credit amount can not be included as income. The truth is, sometimes it can!

As a mortgage professional, I have access to a variety of lenders that I can work with on your behalf. Some of these are the mortgage side of major banks, but many are companies that specialize in mortgages only. There are a few lenders that I work with that do accept the Child Tax Credit as income. As with any mortgage program, there are some restrictions, but generally speaking, this credit can be included in your income as long as it does not exceed 30% of the total income on the application.

For some families, this amount could mean all the difference. This income could allow a family to afford a home they may not have been approved for based on their employment income alone. This is something to keep in mind if you have children under the age of 16 and are looking to purchase a different home.

If you want to learn more about using the Child Tax Credit on your application, or all things mortgages, visit me at mortgagesbyapril.com or email me at ahopfner@dominionlending.ca. I’d love to hear from you and talk about how we can get you into the home of your dreams!

April Hopfner
Mortgage Associate
Dominion Lending Centres – The Mortgage Firm

10 Jun

Using RRSPs for Your Down Payment – What You Need to Know

Down Payments

Posted by: April Hopfner

Saving up for a down payment can be hard! With rising grocery and living costs, it’s difficult to build up savings, let alone thousands of dollars to buy your first home.

Fortunately, the Canadian government has created some programs to assist homebuyers. If you’ve been contributing to an RRSP, the Home Buyer’s Plan might be the perfect option get into your first home sooner!

How does it work?

Here are some of the basics you need to know:
1. You must be a considered a first time homebuyer – this means you must not have occupied a home owned by you or your spouse/common-law partner for the four year period beginning Jan. 1 of the fourth year before you withdrew the RRSP funds and ending 31 days before withdrawal. That’s a mouthful! Basically if you are looking to withdraw funds on July 31, 2019, you can’t have owned or lived in a home your spouse owned from Jan. 1, 2014 to June 30, 2019.
2. You can withdraw up to $35,000 – based on the balance in your RRSP account, you can withdraw up to $35,000, as long as it is not a locked-in or group RRSP. That would be a 5% down payment on a $700,000 home!
3. Your RRSPs must have been in the account for at least 90 days prior to withdrawal – the funds must have been in your account for 90 days or they may not be deductible for any year. Trust me, you want the deduction on your tax return!
4. You must intend to live in the home within 1 year of buying or building it – this means you must move in within a year. And no, you’re not allowed to purchase it as a rental property!
5. You must pay back the RRSPs within 15 years – the total amount you withdraw will be divided by 15 years, and each year you must contribute that amount back into your account. For example, if you withdrew $20,000, you must pay back at least $1,333.33 each year for 15 years. You have the option to contribute more each year to pay it off faster. If you fail to pay back the amount calculated, you will be taxed on those amounts on your annual tax return.
6. You must complete the necessary paperwork – there is a specific request form that needs to be filled out and submitted to your financial institution that confirms you are taking out the funds for a down payment.
7. You must have an agreement to purchase or build a home – this means before you can apply for the program, you must have an actual accepted offer on the home you want to purchase. Pre-approvals do not apply in this case.

The Home Buyer’s Plan can be an exceptional way to help you get into your first home since it is basically an interest-free loan from yourself (as long as you complete the necessary steps and pay it back as directed by the CRA!).

If you have questions about using your RRSP as a down payment, please contact me or your own mortgage or tax professional. More details about the program can be found on the CRA website at: https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/rrsps-related-plans/what-home-buyers-plan/participate-home-buyers-plan.html.

Happy Home Buying!

April Hopfner

1 May

8 Reasons to Use a Mortgage Broker


Posted by: April Hopfner

Good day!  Welcome to my site, and thank you for stopping by. For my first blog post, I wanted to take some time to tell you how it would benefit you to work with a mortgage professional. It really does have great advantages for homebuyers, homeowners, and those looking to get into real estate or investment properties.

So, without further ado, here are eight great reasons to use a mortgage broker:

  1. It saves you time
    Using a broker can save you a substantial amount of time. If you were to shop around to dozens of different lending institutions, make appointments, gather information, check rates, compare pros and cons…. it would take weeks! Wouldn’t you rather be house shopping? As licensed representatives, we are able to work directly with a wide variety of lenders and can quickly narrow down options that will work for you. This is much more quick and convenient for you.
  2. The banks compete for your business
    Brokers have access to an extensive network of lenders in Canada (including major banks, credit unions, trust companies, other private sources). These lenders are always offering competitive rates and actually COMPETE for your business, unlike traditional bank branches. More options = more competition = better rates for you.
  3. There is no cost to you
    Did you know that it costs nothing to meet with a mortgage broker? That’s right, you do not pay any fees to use our services. Brokers are instead paid a finder’s fee. This is paid when we introduce a dependable client, such as yourself, to a lender for a mortgage loan. The focus remains on finding the best product for you, since these fees are standard across the industry.
  4. We ensure you get the best rates and terms
    Brokers shop around on your behalf to their network of lenders to find the right solution for you. This can mean better prepayment options, discounted rates, or other perks that the retail banks may not be able to offer.
  5. You are provided with expert advice
    Brokers have extensive training in the industry, and are always keeping up to date on changing rules and regulations. Our job is to make the mortgage process easier for you, explaining the details along the way and providing you with the best options to suit your needs. We are available to answer questions to give you peace of mind on this major financial decision.
  6. We negotiate so you don’t have to
    Negotiating with your bank may leave you feeling uneasy or uncomfortable. We do this for you so you can be sure you are getting the most competitive rate and terms. You can rest easy knowing that we are using our current knowledge to strike the best deal for you that we can.
  7. You may get special offers
    When we find you a lender for your mortgage, they are eager to have you as a customer. They will often offer special offers and benefits to you, like rewards points programs, etc. as an added bonus that you may not otherwise receive from your bank. Who doesn’t love extra perks?
  8. Continued support
    After your mortgage is signed, our service doesn’t end there. Brokers are available to help with closing details and can refer other professionals if needed. We are also available to answer any questions you may have during your mortgage term.

I hope this has been informative and has helped you understand the benefits of a mortgage professional. If you have any questions or would like to know more about how I can help you, send me an email, and I’d be happy to chat!

April Hopfner
Mortgage Associate
DominionLending Centres – The Mortgage Firm