Yes: about half of first-time homebuyers dip into their RRSPs to help finance a down payment. Under the federal government’s Home Buyers’ Plan, you can use up to $25,000 in RRSP savings ($50,000 for a couple) to help with your down payment on your first home. You get 15 years to repay this amount to your RRSP.
To qualify, the funds you’re using must have been in your RRSP for at least 90 days. You also need a signed agreement to buy a qualifying home.
Even if you’ve saved up for your down payment, the Home Buyers’ Plan can help. Say you saved $20,000 for a down payment—and you still have enough room in your RRSP for a contribution of that amount. You could move that $20,000 into a registered investment at least 90 days before your closing date and then withdraw that money through the Home Buyers’ Plan.
Why? That $20,000 RRSP contribution will count as a tax deduction. Use any tax refund you get to repay the RRSP or to pay other home purchase expenses.
Every homebuyer is different: ask your financial planner whether this strategy makes sense for you.