In many transactions, the Federal Government will allow your bank to lend to you monies which exceed the usual 75% of the purchase price. These are referred to as high-ratio mortgages and allow the purchaser to buy a home with as little as 5% down payment (provided the purchaser has sufficient income to qualify). The 5% down option allows you to borrow up to 95% of the value of the home. The value will be determined by the lender and could be based on an appraisal, however, in most cases it is based upon the purchase price. Any first time buyer who buys a home to use as a principal residence and has sufficient gross family income will be eligible for this program. Certain hardship exceptions to the requirements may be available. High ratio mortgage loans require the buyer to purchase mortgage insurance from Canada Mortgage Housing Corporation or G.E. Capital. This is all arranged by your banking institution or mortgage lender. The premium is a one time fee based on a percentage of the loan amount and can be paid up front at the time of closing or can be added to your mortgage amount and repaid over the life of the mortgage.

Loan Size (% of Price)	Insurance Premium (% of Loan)	Premium on a $100,000 Mortgage
95	3.75	$3,750
90	2.5	$2,500
85	2.0	$2,000
80	1.25	$1,250

RRSP Home Buyers' Plan
First time home buyers (including buyers who have not owned their own residence in the last 5 years) may withdraw up to $20,000 from their RRSP tax free, provided he or she purchases a home prior to October 1 of the following year. If both spouses qualify and are taking joint ownership of the property, up to $40,0000 can be withdrawn. The amount withdrawn must be repaid to the RRSP, interest free, over a 15 year period commencing in the year following the year of withdrawal, with a minimum annual repayment of 1/15 of the amount.