# Aspiring Accountants & Lawyers, pls help: Home Buyer's Plan



## downloadduckss (Aug 5, 2011)

Hi, I don't know where this topic should go, so here is a question for any accountants & lawyers out there:

My fiance and I recently just got engaged last weekend and we are planning to purchase a new home with both our names on the property title soon. I have approx. $10K in my RRSP and I would like to use it as a down payment for our new home...and I wanted to participate in the Home Buyer's Plan (HBP) because I do not own any properties (I currently reside with my folks), but my fiance already has a residential property of her own which she already lives in (declared as her principal place of residence).

According to the HBP, both persons on the new property title must be first time home buyers in order to participate in the HBP program.

http://www.cra-arc.gc.ca/E/pub/tg/rc4135/rc4135-e.html#exception

I wanted to ask if there is anyway we can get a new home using my RRSP to participate in the HBP? My issue is that based on my personal level of income, it is not sufficient to obtain a mortgage large enough to purchase a home by myself... We wouldn't mind delaying our official date to have our papers signed and get married if we can get to participate in the HBP.

Any aspiring accountants & lawyers... do you have any suggestions?

Many thanks,
DD


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## Young&Ambitious (Aug 11, 2010)

If you have only $10k in your RRSP my personal opinion is to leave it there. Don't put all your eggs in one basket (your residence).


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## atrp2biz (Sep 22, 2010)

^Actually, using the HBP simply would simply be a deleverage. He would still have the same real estate exposure with or without the use of the HBP.

Not a lawyer or accountant, but you can be the only one on title. I believe from a family law perspective, it would have the same characteristics as a joint ownership if it is your principle residence.


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## MoneyGal (Apr 24, 2009)

DDS. You purchase the house in your own name as a first-time buyer, prior to your marriage. 

After you are married, add your wife's name on the title. 

Structuring your purchase in this way will allow you to purchase the house as a first-time buyer eligible for the HBP. 

However, you may not be able to get a mortgage as you have described. 

The best advice is to find a mortgage broker or banker to pose your questions to. The issue is not how to get around the HBP restrictions - it is for you to use the HBP *and* qualify for a mortgage without your future spouse's income. 

One final note: if you don't have a downpayment saved (other than in your RRSP?) and your income is not sufficient to qualify you for the mortgage, are you at all concerned that you may not be in a position to take on home ownership at this point? I don't love this plan.


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## the-royal-mail (Dec 11, 2009)

Any reason you can't simply move into her house and keep your RRSPs for retirement (and thus be obligated to pay back into the RRSP in the next 10 yrs)?


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## arie (Mar 13, 2011)

from what you indicate you will either have to put your fiance on title or have her guarantee the mortgage ; some financial institutions do not allow guarantees so your broker will have to sort this out for you ; as well as eligible to use RRSP as a first time homeowner you get a break on the land transfer tax


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## financialnoob (Feb 26, 2011)

I'm confused. Did you AND your fiance want to BOTH use your RRSPs? Or only you? 

Because if it's only you, judging from that HBP link and the example in it, it shouldn't matter that your fiance owned within the last 5 years so long as they are not pulling from their RRSP.



> Example
> In 2007, Paul sold the home he had occupied as his principal place of residence for five years. He then moved into a rented apartment. In 2007, he met Jane and she moved in with him. Jane had been renting her own apartment, and had never owned a home.
> 
> Jane and Paul were married in August 2010. They wanted to withdraw funds from their RRSPs to participate in the HBP in September 2010. Since Paul owned and occupied his home during the period beginning January 1 of the fourth year before the year he wants to make the withdrawal, he is not considered a first-time home buyer, so he cannot participate in the HBP in 2010.
> ...


From that, it seems like if you are the only person pulling from the RRSP, then it's fine. If it's both, then no.


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## kubatron (Jan 17, 2011)

Easy.

Get a mortgage thru MCAP. They allow for guarantors. Use your fiancees income to help you qualify, your RRSPs to put as down thru HBP. CRA won't find that your wife is a guarantor of the mortgage. 

PM Me if you want more info.


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## kubatron (Jan 17, 2011)

financialnoob is the right one here, folks. clap clap. 100% accurate.


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## MoneyGal (Apr 24, 2009)

+1.


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## Charlie (May 20, 2011)

well done FB.

Added wrinkle -- if downloadducks lived in, or moves into fiance's home while they are commonlaw (or after they get married) then he's out of luck. So no sleepovers .

otherwise -- seems he's should have access.


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## downloadduckss (Aug 5, 2011)

Hi... I have some more questions:
1) Does staying at the gf's home half the time (in a calendar year) consider you as common law partners?

2) In my situation, would you think I would qualify for the First Time Home Buyers Credit program ($750) if the gf is a guarantor of the mortgage and I am the sole owner of the new property (no common law relationship = single status)?

Thanks again
DDS


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## MoneyGal (Apr 24, 2009)

What province are you in? Would you add your spouse as a joint owner later? What would be the costs associated with adding her name to the title post-purchase?


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## downloadduckss (Aug 5, 2011)

MoneyGal said:


> What province are you in? Would you add your spouse as a joint owner later? What would be the costs associated with adding her name to the title post-purchase?


Those are very good questions. I'm located in Ontario and assume your questions suggest that the hassles/costs do not overcome the benefits of remaining "single" throughout the whole process.


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