GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

How often this word is used
 
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76% - Very Often

Home Buyers' Plan


Website:http://www.cra-arc.gc.ca/hbp/
Synonyms:régime d'accession à la propriété
Acronyms &
abbreviations:
HBP
Relevant locations:Canada
Notes:Government assistance for first-time homebuyers.
Filed Under: financial-banking, government, mortgages, real-estate
Tags: mortgage, realty
 
Broadly associated with: [Government of Canada]
Narrowly associated with: [Canada Revenue Agency]

Definition of Home Buyers' Plan (HBP)

Home Buyers' Plan (HBP)
1. A government program that gives first-time homebuyers the option to withdraw funds from their registered retirement savings plans (RRSPs) in order to use as a down payment for a mortgage. As of 2012, each borrower may withdraw up to $25,000, but all funds withdrawn using the Home Buyers' Plan (HBP) must be repaid to the RRSP within 15 years.

Related Terms and Acronyms:

  • down payment   The portion of the purchase price a buyer pays, in cash, at the time the loan originates.
  • mortgage (mtg)   A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
  • Registered Retirement Savings Plan (RRSP)   A savings plan introduced by the federal government to encourage Canadians to save money for retirement. The investment and the interest earned on it is sheltered: it will not be taxed as long as it is left in the plan.
      ➥  Tax deferred investment contribution used to reduce income tax.
  • Tax-Free Savings Account (TFSA)   A savings account for Canadians where income earned is not taxed.

Broad and Narrow Associations

[Government of Canada]
  • Registered Retirement Savings Plan (RRSP)Canada, Very Important   A savings plan introduced by the federal government to encourage Canadians to save money for retirement. The investment and the interest earned on it is sheltered: it will not be taxed as long as it is left in the plan.
      ➥  Tax deferred investment contribution used to reduce income tax.
  • Canada Mortgage Bonds (CMB) — Est. 2001, Canada, Very Important   A fully guaranteed fixed interest rate income investment backed by CMHC (a crown corporation of the Government of Canada).
      ➥  Issued by the Canada Housing Trust (CHT).
  • Canada Mortgage and Housing Corporation (CMHC)Company Est.1946, Canada-wide, Very Important   The Canada Mortgage and Housing Corporation: this is a Federally run institution that provides banks and lenders with mortgage insurance. Not to be confused with life or property insurance. In the event of default or foreclosure CMHC assumes responsibility of the property and reimburses the bank/lender the entire mortgage amount. This insurance is required generally when you have less than 25% equity or down payment. This insurance is paid by the property owner in advance but usually added to the mortgage amount. See also "G.E. Capital."
      ➥  Insures Canadian mortgage lenders.
  • Registered Education Savings Plan (RESP)Canada, Very Important   An investment vehicle used for a child's post-secondary education.
      ➥  RESPs are offered by most financial institutions in Canada.
  • Companies' Creditors Arrangement Act (CCAA) — Est. 1985, Canada, Important   A Canadian Act to facilitate compromises and arrangements between companies and their creditors to avoid bankruptcy, foreclosure, seizure of assets or employee job loss.
      ➥  Available to insolvent corporations owing in excess of $5 million.
[Canada Revenue Agency]
  • Registered Retirement Savings Plan (RRSP)Canada, Very Important   A savings plan introduced by the federal government to encourage Canadians to save money for retirement. The investment and the interest earned on it is sheltered: it will not be taxed as long as it is left in the plan.
      ➥  Tax deferred investment contribution used to reduce income tax.
  • Home Renovation Tax Credit (HRTC) — Canada, Important
  • Notice of Assessment (NOA)Canada, Important   A form the federal government issues when personal taxes are complete. A notice of assessment shows a breakdown of the given years income along with the balance owing or refund.
      ➥  Canada Revenue Agency's T451 tax form.
  • Canada Revenue Agency (CRA) — Company, Canada, Important
  • registered retirement income fund (RRIF) — Canada, Important

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