{"id":17986,"date":"2023-07-17T03:37:46","date_gmt":"2023-07-17T03:37:46","guid":{"rendered":"https:\/\/hypotheques.ca\/utiliser-son-reer-pour-solder-ses-dettes\/"},"modified":"2023-07-27T03:47:13","modified_gmt":"2023-07-27T03:47:13","slug":"using-your-rrsp-to-pay-off-debts","status":"publish","type":"post","link":"https:\/\/hypotheques.ca\/en\/blog\/using-your-rrsp-to-pay-off-debts\/","title":{"rendered":"Using your RRSP to pay off debts: A wise approach for property acquisition?"},"content":{"rendered":"\t\t
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Sophie dreamt of owning a townhouse in the suburbs. However, her bank, concerned about her level of debt and financial obligations, refused to grant her a mortgage. One of her friends, Julie, then suggested that she consult us for a second opinion.<\/p>

Analysis of Sophie’s financial situation<\/h2>

Let’s take a more detailed look at Sophie’s financial situation:<\/p>

  • Balance of her current account: $2,000<\/li>
  • An RRSP of: $40,000<\/li>
  • Credit card debts (monthly payment $120): $4,000<\/li>
  • Balance of her car loan ($400 monthly payment): $3,000<\/li>
  • Balance of her student loan ($200 monthly payment): $2,000<\/li>
  • Market value of the desired townhouse: $300,000<\/li>
  • Minimum down payment required: $15,000<\/li><\/ul>

    Initial evaluation and in-depth analysis<\/h2>

    After a first analysis, it seemed that Sophie could not afford to buy this house. The $20,000 she planned to withdraw from her RRSP, combined with her debt ratio, did not present a favourable picture. However, we decided to delve deeper into our analysis.<\/p>

    The opportunity offered by the Home Buyers’ Plan (HBP)<\/h3>

    It is important to note that the Home Buyers’ Plan (HBP) allows you to borrow up to $35,000 from your RRSP for the purchase of a residence.<\/p>

    Illustration of financial planning with the HBP<\/h4>

    By withdrawing $30,000 from her RRSP, Sophie could provide a down payment of $15,000, and use $9,000 to pay off her car loan ($3,000), her student loan ($2,000) and her credit card debts ($4,000). She would thus have $6,000 left from the HBP, $1,200 saved in two months of non-payment of the car and student loans, as well as $2,000 from her personal savings to cover the costs related to the purchase and the move.<\/p>

    Conclusion: A qualified future homeowner<\/h2>

    After reviewing her situation and validating her personal budget, we concluded that Sophie could qualify for the purchase of the coveted house. Isn’t that exciting?<\/p>

    Contact our mortgage brokers for more information<\/h3>

    For more information on mortgage loans, do not hesitate to contact us. Our mortgage brokers are always available to answer your questions and support you in your property acquisition project.<\/p><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

    Discover how your RRSP can be used to settle your debts and facilitate the purchase of a property. Decoding of advantages, disadvantages and specific situations.<\/p>\n","protected":false},"author":3,"featured_media":17975,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[280],"tags":[],"class_list":["post-17986","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-a-home"],"acf":[],"_links":{"self":[{"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/posts\/17986","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/comments?post=17986"}],"version-history":[{"count":4,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/posts\/17986\/revisions"}],"predecessor-version":[{"id":17990,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/posts\/17986\/revisions\/17990"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/media\/17975"}],"wp:attachment":[{"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/media?parent=17986"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/categories?post=17986"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hypotheques.ca\/en\/wp-json\/wp\/v2\/tags?post=17986"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}