Dominion Lending Centres Mortgage Evolution - Patricia Collins                  patricia@patriciacollins.ca | Cel: 604.996.7701 | Fax: 1.877.554.0116 | Follow Me: Facebook Facebook Twitter Tumblr

What is the BC Home Partnership Program?

The BC HOME Partnership assists residents of British Columbia who are eligible first-time homebuyers by providing repayable loans to be secured by a second mortgage up to a maximum of 5% of the purchase price.   The BC HOME Partnership program loan is only available to eligible homebuyers requiring a high-ratio insured first mortgage for the purchase of their home.   Full program details, including eligibility requirements, can be found online at www.bchousing.org.

Click below to view a snapshot of the process and requirements:

BC HOME Partnership Program

 

Who can qualify for a BC HOME loan?

All individuals who will hold both registered and beneficial interests in the home must meet all of the following eligibility requirements:

• Be a Canadian citizen or permanent resident for the last five years; and  

• Have resided in British Columbia for the past 12 months; and

• Be a first-time homebuyer who has not owned an interest in a principal residence anywhere in the world at any time

• The combined, gross income of all individuals on title must not exceed $150,000.

What types of homes are eligible for a BC HOME loan?

The home must be a legal, self-contained mortgageable residence located in British Columbia, with a maximum purchase price of $750,000.  

Rental properties and seasonal/recreation properties are not eligible.

On closing, the homebuyer must become the registered and beneficial owner of the home. The homebuyer must take possession of the home within 30 days of closing and move in within six months.  The home must be occupied as the homebuyer’s principal residence for the first five years (or less if the home is sold).  

Examples of eligible properties include, but are not limited to:

• detached/semi-detached homes

• row homes

• town homes

• condominium homes 

How much BC HOME loan will a homebuyer receive?

The BC HOME loan will match the homebuyer’s down payment up to a maximum of 5% of the purchase price for their home.  The total down payment, including the BC HOME loan, must be less than 20% of the total purchase price.  

The homebuyer is responsible for ensuring the BC HOME loan, combined with the homebuyer's down payment, meets the minimum down payment requirements to qualify for an insured first mortgage.  

Is the homebuyer responsible for legal costs?

The homebuyer is responsible for all costs associated with the purchase and financing of their home, including legal costs of the homebuyer's lawyer/notary public.   The homebuyer is also responsible for BC Housing's legal costs.  The amount of BC Housing's legal costs will be disclosed to the homebuyer at the time of BC HOME loan approval.

Is the BC HOME loan approval conditional?

Yes, the BC HOME loan approval includes conditions, such as closing within the stated time period.
 
The homebuyer’s application will be reviewed to confirm all listed applicants meet the BC HOME Partnership's eligibility requirements.
 
Once the homebuyer enters into a Contract of Purchase and Sale, they will provide their lender with a copy of the Loan Approval letter.

Will CMHC recognize the BC HOME loan as a traditional source of down payment?

CMHC will recognize the BC HOME loan as a non-traditional source of down payment. 

Will the BC HOME loan be registered on title?

The BC HOME loan will be secured by a second mortgage in favour of British Columbia Housing Management Commission (the Second Mortgage) registered on title to the home on the closing date.  The principal amount secured by the Second Mortgage will be the BC HOME loan plus an amount to cover BC Housing's legal costs.  

Is the homebuyer required to obtain a first mortgage? 

The homebuyer must obtain approval from a first mortgage lender for a high-ratio insured first mortgage.

What are the terms of the Second Mortgage?

The term of the Second Mortgage will be 25 years.  No payments on account of principal and interest will be required during the first five years of the term.  
 
The homebuyer may repay the BC HOME loan in full or in part at any time with no penalty.  As of the fifth anniversary from when the homebuyer received the BC HOME loan funds, interest will start accruing and the homebuyer will begin making monthly payments of principal and interest, amortized over the remaining 20 years (since the first five years the homebuyer was not required to make payments of principal and interest).  The initial interest rate that will apply on the fifth anniversary will be established in the Loan Approval letter; a five year fixed rate will be set, equal to the current Royal Bank of Canada Prime Rate plus 0.5%. The interest rate will be reset at the Royal Bank of Canada Prime Rate plus 0.5% at each of the 10th, 15th and 20th anniversary dates.

How will the BC HOME loan be funded?

Funds secured by the Second Mortgage will be released to the homebuyer's lawyer/notary public at closing, following the registration of the Second Mortgage.  Assuming all conditions to funding have been met, the net amount the homebuyer's lawyer/notary public can expect to receive at closing will be the amount of the BC HOME loan, with BC Housing's lawyer retaining the amount required to pay for BC Housing's Legal Costs.