While we recently outlined the advantages of the First Time Home Buyer Incentive, as a first-time homebuyer in Oxford County, you may be able to access other funding sources.
Oxford County delivers the Affordable Home Ownership Program on behalf of both the federal and provincial governments. If your household income is $92,700 or less and you’re currently renting in Oxford County, you may be eligible to receive a down-payment assistance loan of 5% of the purchase price of an eligible home – to a max of $21,000.
Unlike the First Time Home Buyer Incentive, with this program, you don’t need to match or exceed the down payment yourself – the loan covers your down payment.
Under the program, you can buy a single-family home, a semi-detached, a townhouse (condo or freehold), a row house, or a condo apartment. The home must be located in Oxford County and have a maximum purchase price of $425,000. It includes new construction and resale.
The loan is interest-free. And it’s forgivable after 20 years. So if you live in the home for 20 years or more, you don’t have to pay it back.
Of course, 20 years is a long time, and there’s a good chance you’ll sell sooner than that. If you do, the terms are similar to those of the First Time Home Buyer Incentive. You pay back the principal, plus 5% of the capital appreciation of the house (effectively 5% of the home’s value, as with the FTHBI). If the house increases in value by $40,000, you pay back the loan plus $2000. (If the house decreases in value, the terms are better than with the FTHBI. The loan takes the hit for the decrease [capital loss] – the loss is subtracted entirely from the loan amount, and if it’s more than the loan amount, the loan’s forgiven.)
Additional features and benefits of Oxford County’s Affordable Home Ownership Program
You may have a parent or another party who is not living in the home guarantee your first mortgage. However, due to the terms of the loan, you cannot have a guarantor on title, nor can you have a co- signer on title that will not be living with you in the home.
Affordable Home Ownership Program approval and mortgage insurance underwriting approval are two separate processes. In some cases, households may be approved by the County under this program, but may not be eligible for a mortgage or mortgage insurance.
You’re not required to use Canada Mortgage and Housing Corporation (CMHC) insurance; however, CMHC will waive the usual surcharge for extending the amortization period to 25 years. And CMHC considers the down payment assistance as your equity in its underwriting evaluation.
Are you eligible for the Affordable Home Ownership Program in Oxford County?
Beyond the income qualification, to be eligible, you need to
- be able to qualify for a mortgage;
- be at least 18 years old and currently renting in Oxford County;
- not currently own or have an interest in (partial ownership of) a home;
- not owe money to a community housing landlord;
- be a legal resident of Canada;
- agree to live in this home as your one and only residence (you cannot transfer or lease it to someone else);
- hold less than approximately $40,000 in household assets; and,
- be purchasing a home with a value of less than $425,000. Attend your bank or visit a mortgage lender to determine if you qualify for a mortgage. A mortgage pre-approval letter is required to be eligible for the program.
More details from Oxford County on the Affordable Home Ownership Program
Oxford County’s Affordable Home Ownership Program may be the solution you’ve been looking for to break into the housing market. I’d like to help you take advantage of this valuable program and put you in your own very first home.
Don’t forget to download your free First Time Homebuyers Guide.
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