Posted: 1 May '21

Do You Automatically Qualify for FTHBI When Buying Your First Home?

Do You Automatically Qualify for FTHBI When Buying Your First Home?

The costs of buying your first home can quickly add up, making it difficult for you to own your own home. Fortunately, federal government programs such as the First-Time Home Buyer Incentive (FTHBI) can make it easier for some to purchase their first home. FTHBI can potentially help you qualify for a first-time home buyer loan by matching your down payment contribution to a maximum of 10% of the home’s price. Call us today to get started on your path to homeownership. 

What Is FTHBI?

The FTHBI lowers the cost of buying your first home by sharing the cost of your down payment. By so doing, the incentive reduces your monthly mortgage payments which helps some to qualify for a mortgage that they may not have without the incentive.  

The incentive works as a shared equity mortgage. When you sell your home or finish paying off the mortgage, you pay back the 5%-10% loaned to you based off the current market value at that time. You do have options to pay it back sooner. A mortgage broker will help guide you through this process. 

The FTHBI offers: 

  • 5% of the home’s price for the purchase of a resale home.  
  • 5% or 10% of the home’s price for a newly constructed home.  


Let’s say the price at the point of buying your first home is $300,000. FTHBI offers 5% or $15,000. If your home’s value decreases to $200,000, you pay back $10,000. However, if the value of your home’s value rises to $400,000 by the time you pay back the incentive, you pay back $20,000. 

Do You Qualify for the FTHBI? 

The FTHBI is for you if you’re buying your first home. You are considered a first-time home buyer if:  

  • You have never purchased a home before. 
  • You have not occupied the home you and your spouse or common-law partner owned within the last four years.  
  • You’ve had a breakdown of your marriage or common-law partnership.  
  • You are a Canadian citizen, a permanent resident in Canada, or a non-permanent resident with authorization to work in Canada.  

If you meet the criteria above, you still need to cover the checklist below.  

  • Your qualifying income should be less than $120,000. The qualifying income is your wages, money from investments, and rental incomes.  
  • You should have the minimum down payment. The minimum down payment is 5% for homes below $500,000 in value and 10% for any amount above $500,000. However, the total amount of down payment, including the FTHBI, should be less than 20% of the house’s purchase price. Because the FTHBI only applied to homes where the down payment is less than 20%, it means that you need CHMC mortgage default insurance when buying your first home.  
  • The FTHBI caps borrowing at four times your qualifying income. As earlier mentioned, the maximum qualifying income is $120,000 which means that the maximum amount you can get from the incentive is $480,000.  

Should You Consider Buying Your First Home With FTHBI? 

If you need assistance understanding and applying for the FTHBI, look no further than Dominion Lending Centres. Our mortgage mentors are more than happy to help you apply and find lenders when buying your first home in Edmonton. Contact us today.

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