27 Jul

How to Save When Buying a Home in B.C. (2025)

General

Posted by: Anastasia Lipatnikova

Buying a home in British Columbia can be a major financial commitment — but the good news is, there are a number of programs available in 2025 that can help reduce your upfront costs and long-term expenses. Whether you’re a first-time buyer or simply purchasing a new home, several federal and provincial incentives can support you on your path to homeownership.

Below, I’ve outlined key rebates, grants, and tax credits available to homebuyers in B.C., so you can better understand your options and take advantage of the support that may apply to your situation

Provincial Incentives (British Columbia)

1. Property Transfer Tax (PTT) Exemptions
First‑Time Home Buyers’ Program
If you qualify as a first-time buyer and meet the eligibility criteria, you may be eligible for a full or partial exemption from Property Transfer Tax:

  • Full exemption for homes with a fair market value of $500,000 or less

  • Partial exemption for homes priced:

    • $8,000 for homes between $500,000 and $835,000

    • Phased out for homes between $835,000 and $860,000

  • No exemption for homes over $860,000

2. BC Home Owner Grant
While the BC Home Owner Grant isn’t limited to first-time buyers, it can still provide meaningful annual savings for new homeowners — especially in the early years of ownership. This grant helps reduce the amount of property tax you pay on your principal residence.

  • Up to $570 for homes in Metro Vancouver, the Capital Region, and the Fraser Valley

  • Up to $770 for homes in all other areas of the province

  • Available for homes with an assessed or partitioned value up to $2,175,000

  • For homes valued above that, the grant is reduced by $5 for every $1,000 over the threshold

Federal Incentives

3. First Home Savings Account (FHSA)
A tax-advantaged way to save for your first home:

  • Contribute up to $8,000 per year, with a $40,000 lifetime limit

  • Contributions are tax-deductible

  • Withdrawals used to purchase a qualifying home are tax-free

4. Home Buyers’ Plan (HBP)
Borrow from your RRSP to help with your down payment:

  • Withdraw up to $60,000 per person (tax-free)

  • Couples can withdraw up to $120,000 combined

  • Repay over 15 years

  • If the withdrawal was made between Jan 1, 2022 and Dec 31, 2025, you may delay repayment for 3 years

5. Home Buyers’ Tax Credit (HBTC)
A helpful tax break when filing your return:

  • Claim a $10,000 non-refundable tax credit

  • Results in up to $1,500 in tax savings

  • Can be split between spouses or common-law partners

6. GST/HST New Housing Rebate
This federal rebate allows eligible buyers to recover part of the GST or federal HST paid on a new or substantially renovated home intended as their primary residence.

How it works in BC:

  • BC charges only the 5% federal GST (no HST), so the rebate applies to this GST portion only

  • Eligible buyers can recover 36% of the GST paid on homes priced up to $350,000 (before GST)

  • The maximum rebate amount is $6,300

  • For homes priced between $350,000 and $450,000, the rebate amount decreases gradually

  • No rebate is available for homes priced $450,000 or more

  • This rebate is not limited to first-time home buyers

7. New GST/HST Rebate for First-Time Home Buyers (2025 Proposal)
The federal government has proposed a new rebate exclusively for first-time home buyers to make new home purchases more affordable.

How it would work in BC:

  • First-time buyers could receive a 100% rebate of the 5% GST on newly built homes valued up to $1 million

  • For homes priced between $1 million and $1.5 million, the rebate is gradually reduced

  • No rebate applies to homes priced $1.5 million or more

  • This rebate would replace the existing partial GST New Housing Rebate for eligible first-time buyers in BC, providing greater upfront savings by allowing them to recover 100% of the GST paid

Please note: This is proposed legislation, tabled on June 5, 2025, and is not yet law. It is subject to parliamentary approval and may change before becoming official.

Final Thoughts

With a mix of tax exemptions, grants, and savings programs, first-time buyers in B.C. have a strong toolkit to reduce the financial barriers to homeownership. Taking the time to understand what you’re eligible for can help you save thousands.

Please note: Qualifications for first-time home buyer incentives differ from program to program, and other rules and conditions may apply. Always verify your eligibility and consult a professional for personalized advice.

 

22 Jul

Collateral Charge Mortgages: What You Need to Know Before You Sign

Mortgage Tips

Posted by: Anastasia Lipatnikova

Did you know some lenders register all their mortgages as collateral charges – including major banks like TD?

If you’re refinancing, renewing, or applying for a new mortgage, this detail could affect how easily you access your home equity or switch lenders down the road. Yet many borrowers only learn about this after the fact – sometimes too late to make an informed decision.

As a mortgage broker, I often speak with clients who are hesitant about collateral charge mortgages – usually because of something they’ve read online or heard from others. There’s a lot of confusion and misinformation out there, and my job is to help you cut through the noise so you can make a confident, informed decision that aligns with your goals.

Standard vs. Collateral Charge Mortgages

Standard Charge Mortgage

A standard charge mortgage registers only the loan amount you’re borrowing – nothing more. It’s simple and straightforward. If you want to borrow more later (say, for renovations), you’ll need to refinance, requalify, and pay legal fees to register a new mortgage.

This type of mortgage is also easier to switch to a new lender at renewal, which can give you more flexibility and negotiating power.

 

Collateral Charge Mortgage

A collateral charge is more flexible but also more complex. It allows the lender to register a higher amount than the initial loan, sometimes up to 125% of the appraised property value. While you’re only borrowing a portion of that now, the remaining amount acts as potential borrowing room in the future.

Generally, lenders will allow access to additional funds up to 80% of your home’s value, as long as you meet their requirements. You may be able to access those funds without refinancing, but you’ll still need to qualify based on the lender’s standard criteria at that time.

Some lenders even structure these mortgages so your HELOC limit increases as you pay down your mortgage principal.

 

Pros and Cons of Collateral Charge Mortgages

Pros

  1. Flexible access to additional funds: You can borrow more money in the future without having to refinance your entire mortgage, saving you time and legal fees.

  2. Long-term relationship benefits: If you plan to stay with the same lender, a collateral charge mortgage allows you to tap into your home equity more easily as your needs change.

  3. Cost savings on accessing funds: Since the mortgage charge is already registered for a higher amount, you can avoid additional legal and registration fees when you access extra funds later on.

Cons

  1. Harder (and costlier) to switch lenders: Unlike standard charges that can often be transferred easily, switching a collateral charge usually means discharging your mortgage and registering a new one. That involves legal work.

  2. Potentially limited borrowing options from other lenders: Some lenders register up to 125% of your home’s value, which could block you from accessing financing elsewhere – even if you have lots of equity.

  3. Right of offset risk: Some banks may have the right to use your home equity to recover money you owe them on other financial products – like credit cards or personal loans. It’s rare, but something to be aware of.

Final Thoughts from a Broker

Collateral charge mortgages are neither good nor bad – they’re just different. The key is understanding how they work and how they fit into your long-term plans.

 

If flexibility is a priority, they can be an excellent choice. If lender portability and easier switching are more important, a standard charge might serve you better.

Still unsure? Let’s talk through your options. I’ll help you weigh the pros and cons based on your unique situation -so you can make a confident, informed decision.

Did you know? As your mortgage broker, I can assist you in switching your collateral charge mortgage to another lender, help you avoid the risks associated with the right of offset, and work to save or eliminate fees during the switch process.

Ready to explore your options? Contact me today for a free consultation!

7 Jul

What Do Lenders Look at During Mortgage Pre-Approval? Understanding the 5 Cs of Credit

Mortgage Tips

Posted by: Anastasia Lipatnikova

If you’re thinking about buying a home, one of the smartest first steps is getting pre-approved for a mortgage. But what exactly do lenders evaluate before approving your application

Mortgage professionals rely on the “Five Cs of Credit”- a framework used to assess your
financial health and readiness for a mortgage. By understanding these factors, you can prepare more effectively and increase your chances of approval, often with better rates and terms.

Here’s what each “C” means and how you can strengthen your application:

1. Character: Are You a Responsible Borrower?

This isn’t about your personality – it’s about your financial reliability. Lenders want to know if you’re likely to repay the mortgage based on your past actions and current situation.

To assess Character lenders look at:

  • Your employment stability (How long have you been at your job?)
  • Educational background or training (Does your field show long-term potential?)
  • Your residency history (Have you remained in the same area or moved frequently?)
  • Self-employment or business experience

These details help lenders evaluate your financial character. A stable job and consistent residence history can tip the scale in your favour.

✅ Tip: Fill out your mortgage application completely and accurately – lenders gather much of this information from your submission.

2. Capital: How Much Are You Contributing?

Capital refers to your down payment and the amount of your own money you’re putting toward the home. The larger your down payment, the lower the risk for lenders which often means better mortgage options for you.Lenders also examine your savings habits and net worth.

To assess Capital lenders look at:

  • Personal savings and investment accounts
  • RRSPs and TFSAs
  • Vehicles you own
  • Other property or valuable assets
  • Showing that you can save and build assets demonstrates financial discipline and stability.

✅ Tip: Aim to save between 5% and 20% of the home’s value for your down payment. A higher contribution can make your application stand out.

3. Capacity: Can You Afford the Mortgage Payments?

Your ability to make monthly payments is one of the most important considerations. Lenders need to confirm that your income can comfortably support your mortgage.

To assess Capacity lenders look at:

  • Your gross (before-tax) income
  • Monthly debt obligations (credit cards, car payments, loans)
  • Debt service ratios (how much of your income goes to debts)
  • Most lenders follow strict guidelines. For example, your Gross Debt Service (GDS) ratio should generally stay under 39%, while your Total Debt Service (TDS) ratio shouldn’t exceed 44%.

✅ Tip: Pay down debts before applying to improve your ratios – and potentially qualify for a larger mortgage.

4. Credit: What Does Your Credit History Reveal?

Lenders review your credit score and credit report to see how you’ve handled debt in the past. A strong credit history reassures them that you’re likely to manage your mortgage responsibly.

To assess Credit history lenders look at:

  • Your credit score
  • Payment history (Are you paying on time?)
  • Credit utilization (How much of your credit limits are you using?)
  • Length of credit history
  • If you’ve had missed payments, collections, or bankruptcies, that could affect your chances – but the good news is that credit can improve over time with consistent effort.

✅ Tip: Review your credit report before applying and correct any errors. Pay down high balances and avoid new credit inquiries during the pre-approval process. Keep your credit utilization below 30% of your available credit limit.

5. Collateral: What Property Is Backing the Loan?

In a mortgage, the home you’re buying serves as the collateral. If you can’t make your payments, the lender can sell the property to recover the loan.

To assess Collateral lenders look at :

  • The appraised value of the home
  • The type of property (single-family home, condo, duplex, etc.)
  • Its condition and location
  • A well-maintained property in a desirable area strengthens your application, as it presents less risk for the lender.

✅ Tip: Choosing a solid property in a stable neighbourhood helps you qualify more easily and may even increase your borrowing power.

Final Thoughts: Set Yourself Up for Success

Getting pre-approved is a key step in your homeownership journey. When you understand the Five Cs of Credit, you gain a powerful advantage. By preparing in these five areas, you’ll put yourself in a strong position – not just to get approved, but to secure a mortgage that truly fits your goals.