This is your current starting point in the FTB Method. Before you start evaluating what you can afford, you need to understand what funds you may actually have available to purchase a home — and what those funds will need to cover.
Having money saved for a home is an important starting point. But the amount sitting in your accounts is not necessarily the same as the amount you should plan to use toward a purchase.
Your purchase funds may come from several different sources — personal savings, a First Home Savings Account, an RRSP through the Home Buyers' Plan, gifted funds, or other eligible assets.
Each source can have different rules, documentation requirements, timing considerations, and limitations.
You also need to think beyond the down payment. Deposits, closing costs, land transfer tax, moving expenses, immediate homeownership costs, and an appropriate reserve can all affect how much cash you actually need available.
The goal at this stage is not to determine exactly what home you can afford. It is to create a clear picture of the funds you have, where they will come from, and what you need to keep available.
The amount in your account is not the same thing as the amount you should plan to spend.
Before you can understand your purchase position, you need to identify the different sources of money that may be available to you.
Money you've accumulated in savings accounts or other readily accessible accounts may form part of your purchase funds.
How much is actually available, when you can access it, and how much you need to keep aside for other priorities.
An FHSA can provide an important source of funds for an eligible first-time homebuyer.
Your FHSA balance, contribution room, and whether you meet the requirements for a qualifying withdrawal.
The Home Buyers' Plan may allow an eligible buyer to withdraw funds from an RRSP for a qualifying home purchase.
Whether you qualify, how much may be available, and the repayment requirements that apply.
Some buyers may receive financial assistance from family members toward their purchase.
Whether the funds meet lender requirements and what documentation may be required to verify the source.
Investments or other financial assets may form part of your purchase funds depending on their nature, liquidity, and lender requirements.
How quickly the funds can be accessed and whether they can be used for the purchase without creating another financial problem.
Your down payment is only one part of the money you'll need to plan for. Understanding the other costs early can help prevent surprises later.
The portion of the purchase price you intend to pay from your own funds rather than through your mortgage.
Money that may need to be available when you make an offer, depending on the terms of the transaction. The deposit generally forms part of the funds applied toward the purchase.
Expenses associated with completing the purchase can include legal fees, adjustments, registration costs, and other transaction-related expenses.
Buying a home shouldn't leave you with nothing available for moving, immediate needs, unexpected expenses, or normal life after closing.
Several programs may help eligible first-time buyers build or access funds for a home purchase. The important part is understanding what each program actually does and whether its requirements apply to you.
Eligible individuals can generally contribute up to $8,000 per year to an FHSA, subject to the applicable rules and contribution room, with a lifetime contribution limit of $40,000.
Potential tax-advantaged purchase fundsAn eligible individual may be able to withdraw up to $60,000 from an RRSP under the Home Buyers' Plan for a qualifying home purchase.
RRSP funds with repayment requirementsQualifying first-time homebuyers may be eligible for an Ontario Land Transfer Tax refund of up to $4,000, subject to the applicable requirements.
Potential reduction of Ontario LTT payableYou don't need every number finalized yet. But you should be able to explain the basic story behind your purchase funds.
I know which accounts, programs, or other sources I may use.
I understand whether the money can be accessed when I need it.
I can document the source of my funds if my lender requires verification.
I've thought about deposits, closing costs, moving expenses, and other immediate costs.
I understand that using every available dollar toward the purchase may not be appropriate.
You're ready to move beyond Purchase Funds when you can clearly explain where the money for your purchase will come from, which programs may apply to you, what funds you can access, and what cash you need to keep available.
The next stage of the FTB Method is Financial Preparation — turning your current financial position into a stronger foundation for the homebuying process.
Continue Your RoadmapEducational information only. The FTB Method is designed to help you understand the homebuying process. It is not financial, tax, mortgage, or legal advice. Program rules and eligibility can change. Confirm current requirements with the appropriate government authorities, your lender, and qualified professionals before making financial decisions.
