Down payment dilemma

Is the Home Buyers’ Plan right for you?


If you’re a first-time homebuyer, your RRSP could give you a helping hand well before you retire. The Government of Canada offers the Home Buyers’ Plan (HBP), which allows you to borrow from your RRSP for a down payment on your first home.

HBP program details

  • You can withdraw up to $25,000 from your RRSP for the purposes of purchasing a home.
  • The home must be your principal residence.
  • You have to be a resident of Canada.
  • Your RRSP contributions must stay in the RRSP for at least 90 days before you can withdraw them under the HBP.
  • You have up to 15 years to repay the funds borrowed back into your RRSP.
  • You won’t be charged any interest, because you are essentially borrowing money from yourself.
  • Additional RRSP/HBP reimbursement information.

Is the HBP right for you?

Borrowing from your RRSP can be a great way to jumpstart your down payment. It’s basically an interest-free loan to yourself which you can repay over the next 15 years. It’s especially helpful because you can enjoy the tax deduction associated with your contribution now and save for your first home.

Remember, the amount you can borrow from your RRSP for a down payment is limited to $25,000. Good news for B.C. residents: there is no conflict between the new BC Home Partnership program and the HBP.

Additional HBP tips

  • Even if you have owned a home previously, under the HBP program you could still be considered a first-time homebuyer.
  • To apply, just fill out this HBP form and take it in to your financial institution.
  • Couples can withdraw up to $50,000 ($25,000 each).
  • If one half of a couple is not considered a first-time homebuyer, the other can still participate.
  • Couples where one party contributes to the other party’s RRSP – often referred to as a spousal RRSP – should review joint RRSP guidelines.

And now a note from our lawyers…

This blog post provides general information only, and does not constitute financial, accounting, tax, legal or other professional advice. We encourage you to obtain personalized advice from qualified professionals regarding your particular circumstances. Please see our Terms of Use.

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