When Can you take out RRSP to buy a Property??

[Keigotw]

When Can you take out RRSP to buy a Property??

There is a Condo, that I am thinking to get
which will be finish in 2007
For now I have to give some payments
5% 1st
5% in 60 days
5% in 150 Days
5% when constructions starts
and 5% on closing

So when can I use the RRSP??? can I used it right away to put towards down payment? or I have to wait for Closing to be able to use the RRSP?

[Keigotw]

oops I guess I should of posted on "Personal Finance"
section

MOD please move it
thanks

[ronny1980]

wrong forum

[Rehan]

You can use your HBP withdrawal for any purpose...it doesn't have to go towards the house at all.

In your case, you can withdraw the funds in 2005 as long as you commit to buy before October 1, 2006 and your closing is before October 1, 2007 (based on the "Extensions" rule at http://www.cra-arc.gc.ca/tax/individuals/topics/rrsp/withdrawals/hbp/conditions/deadline-e.html ).

[Keigotw]

You can use your HBP withdrawal for any purpose...it doesn't have to go towards the house at all.

In your case, you can withdraw the funds in 2005 as long as you commit to buy before October 1, 2006 and your closing is before October 1, 2007 (based on the "Extensions" rule at http://www.cra-arc.gc.ca/tax/individuals/topics/rrsp/withdrawals/hbp/conditions/deadline-e.html ).

I been reading, but still don't get it
Say if I enter into an agreement today
and I pay the 1st 5% down.
and the 2nd 5% down in 60 days

Can I withdraw from RRPS to pay my 3rd 5% which is 150 days after my 2nd 5% ??

or I have to use the RRSP on my 1st 5% down?
any buy have any ideas? thanks

[Rehan]

I been reading, but still don't get it
Say if I enter into an agreement today
and I pay the 1st 5% down.
and the 2nd 5% down in 60 days

Can I withdraw from RRPS to py my 3rd 5% which is 150 days after my 2nd 5% ??You can make multiple withdrawals as long as they're all in the same calendar year (e.g., 2005).

The withdrawals from your RRSP are completely unrelated to your deposit or down payment...you could withdraw $20,000 today and spend it on a car, if you wanted to. If you choose to put it towards the down payment, then you can use it for any or all of the down payment portions.

[Keigotw]

You can make multiple withdrawals as long as they're all in the same calendar year (e.g., 2005).

The withdrawals from your RRSP are completely unrelated to your deposit or down payment...you could withdraw $20,000 today and spend it on a car, if you wanted to. If you choose to put it towards the down payment, then you can use it for any or all of the down payment portions.

I read one of the examples provided by HPB. It says
"Kate buys a qualifying home with a closing date of Nov. 01 2003. SHE MUST make her final withdraw under the HBP no later then 30 days after the closing date. "

Does that mean in my case: I can put 15% down from my own money with the agreement and take out from the rest from the RRSP in 2007 when the closing happens??


I also see HBP saying
"Neither you nor your spouse, nor common-law partner can own the qualifying home more than 30 days before a withdrawal is made.
"
If I enter in to agreement now and closing date is in 2007
do I break the 30 day rule?

[Rehan]

I read one of the examples provided by HPB. It says
"Kate buys a qualifying home with a closing date of Nov. 01 2003. SHE MUST make her final withdraw under the HBP no later then 30 days after the closing date. "

Does that mean in my case: I can put 15% down from my own money with the agreement and take out from the rest from the RRSP in 2007 when the closing happens??Yes. If your closing is before October 1, 2007 then you could withdraw from your RRSP any time between now and 30 days after your closing. (But all withdrawals must be in the same calendar year.)


I also see HBP saying
"Neither you nor your spouse, nor common-law partner can own the qualifying home more than 30 days before a withdrawal is made.
"
If I enter in to agreement now and closing date is in 2007
do I break the 30 day rule?No, because you don't own the home until the closing date. If you withdraw more than 30 days after that date in 2007, then you'd be breaking the rule.

[Keigotw]

Thank you Rehan

I get it now

thank you