Federal Government of Canada How the Federal Government Impacts the Money Lending Process

Federal Government of Canada How the Federal Government Impacts the Money Lending Process

As in most countries, the Federal Government of Canada imposes rules and regulations on the money lending process. From mortgage loan rules to government of Canada grants, the federal government is a constant presence.


As of 2008, the Canadian government has imposed several restrictions on home loans. Prior to these restrictions, it was possible to obtain home loans spanning 40 years. Now, the maximum length is 25 years. For those who struggle with getting together a substantial down payment, this means that being able to purchase a home is more difficult.

Another change made that same year is that zero down payment options were eliminated. All home buyers are required to put down at least 5%. When you combine these two items, it makes it difficult for people who are not financially well off to buy homes. However, that was the point—preventing those who are financially unstable from purchasing a home they would ultimately lose. It is the government’s way of heading off another housing crisis.

Low Income Housing and Assistance

The good news is that Canada does have other options for individuals who cannot obtain a home through traditional means. The government offers affordable housing options to low income families and individuals. These homes are meant to serve the 20% of the Canadian population that is unable to purchase homes on the primary market.

The exact types of housing and assistance available vary by province. In Alberta, the Affordable Housing Development is available to help individuals who cannot afford housing otherwise. They also offer special assistance to seniors and the disabled.

Small Business Grants and Loans

If you are looking into purchasing a property for a business instead of a home, Government of Canada small business grants might be what you need to get off the ground. The Canada Small Business Financing program provides assistance with loans and grants to help budding businesses get their start. Essentially, the government works with other lenders and shares the risk of providing you with the funds you need, making the lending institution more receptive to financing your operation.


If you have a line of credit or a lending institution that is willing to be flexible with you, you can take advantage of the government of Canada auctions. These auctions sell off items the government has confiscated but has no use for, including home. Excellent deals can be had here if you know what you are looking for.

Income Tax

Finally, the government of Canada income tax breaks for first time home buyers can make the entire process all the more affordable. This $5,000 credit gives back to the new homeowner what he or she might need to fix up or furnish their home. For some buyers, this is the incentive they need to take the plunge and buy their first home.

To learn more about how the federal government can impact the home buying process, contact iMortgage Solutions today by visiting mymortgagebroker.com. They will help you navigate the process and get the funding that suits your needs.

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