Qualifying for the Home Buyers’ Plan

Living in someone else’s house could leave you ineligible

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From the November 2016 issue of the magazine.

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Q: My boyfriend and I have lived together for the last year in a house he bought before we met. Now, we plan on buying a place together. But when I asked my bank advisor how to use the Home Buyers’ Plan, he said we no longer qualify because we are not first-time buyers. Is this true?

—Amanda, Calgary

A: The confusion has to do with when you and your boyfriend are first considered a common-law couple. Typically, provincial rules dictate when this designation applies, but under federal law a couple is considered common-law if they’ve lived together for at least a year. To qualify for the federal HBP, you must be a first-time home buyer, or someone who has not owned, or lived with someone who has owned, property in the four years before applying to use your RRSP money through the HBP. So your bank advisor is correct: You don’t qualify as a first-time home buyer because you lived with your boyfriend as a common-law spouse and he owned property. Also, unfortunately, neither of you will qualify for the Home Buyers’ Tax Credit, a rebate of up to $750 given to first-time buyers (based on the same criteria as the HBP).

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Romana King is the senior editor and real estate specialist at MoneySense. She is also a licensed real estate sales agent. Follow her on Twitter (@RKHomeowner) or on Facebook.

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