ADVICE FROM DESJARDINS
Relocating for work or school? If you are moving to start a new job, run a business or study full-time at a post-secondary level, you may be eligible to deduct some of your moving expenses from your income taxes.
Eligibility rules are the same for both the Canada Revenue Agency and Revenu Québec. If you want to deduct moving expenses, your new home must put you at least 40 km closer to your workplace or school.
Expenses you can deduct:
- moving company fees
- rental fees for a truck or trailer
- storage costs for your household belongings
- food and lodging expenses for you and your family during the trip to your new home
- the cost of selling your old home or cancelling your lease
- the cost of upkeep for your old home if it remains vacant for a time despite reasonable efforts to sell (maximum $5,000)
It’s usually best to find a balance between paying your mortgage and contributing to your RRSP. Here’s why.
In a perfect world, paying off your mortgage before contributing to your RRSP would be a good thing to do. But that would call for extreme discipline.
After your last mortgage payment, you would have to keep putting the same monthly amount aside for your retirement. That’s not very realistic.
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Another possibility is to make substantial contributions to your RRSP before buying a home. However, a home is more than a financial investment; it’s a life choice that you don’t want to put off for too long. The RRSP that you started early could help make you a homeowner more quickly through the Home Buyers’ Plan.
That’s why it’s usually best to find a balance between paying your mortgage and contributing to your RRSP, even when RRSP returns are lower than mortgage interest rates.[……]
One morning like any other, when you aren’t expecting anyone, there comes a knock at the door. It’s a bailiff who hands you a repossession notice from a financial institution for defaulting on your mortgage payments. But you already paid off your mortgage a few years ago. They must have the wrong person, right? Nope–the title on your home has been stolen.
Title theft, a type of mortgage fraud, isn’t common–but it’s been on the rise in recent years. It starts with stealing your identity. Fraudsters create fake documents so they can take over the title on your property and then remortgage your house or sell it and, in any case, make off with the proceeds.[……]
Here are the answers to your questions about mortgage loans.
What is the minimum down payment?
You need to put down at least 20% of the selling price to qualify for a mortgage. If you don’t have 20%, you can take out mortgage insurance and you’ll only need to put down 5%. In both cases you need to prove you have 1.5% of the selling price to cover start-up costs.
How can some builders have properties for sale without requiring a down payment?
Some builders do offer Canada Mortgage and Housing Corporation (CMHC)-approved programs that don’t require a down payment. However, the programs usually have very specific eligibility criteria and the down payment is often just delayed.
There are really only a few exceptions to the legal requirement to make a down payment when buying a property. The best way to lower your down payment is to insure your mortgage with CMHC or Genworth. Insurance can get your down payment to 5%.
As with traditional mortgage loan insurance, every down payment has to come from the buyer’s own resources or close relatives.
Debt-savvy buyers can put 5% down and access many resources, including a loan or lender incentives, as long as the down payment is from a source that is arm’s length to and not tied to the purchase or sale of the property. Contact your lender to see if they can offer you mortgage insurance and if you’re eligible.[……]
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With a lot of discipline and determination, you can stay on top of your debts. Some decisions you make when buying a home can substantially reduce your interest fees.
Here are some things that could have a big impact on how much money is left in your pocket.
- Make the largest down payment you can
This will reduce the amount of your mortgage and the length of time it takes you to repay it. To help you increase your down payment, you can use the Home Buyers’ Plan. To avoid paying interest needlessly, consider buying a smaller home and paying it off in a period of 17 years.[……]