Can I use my own RRSP as mortgage for personal real estate property?

[zarmas01]

Can I use my own RRSP as mortgage for personal real estate property? Instead of withdrawing cash from RRSP which triggers immediate tax withholding. If so how can one go about setting this up?

Thanks,
Mark

 

[nickytu]

Usually you want to do a RRSP mortgage arms-length, meaning someone who's not in your family. If you want to go non-arms-length, you would have some limitation and you would need to pay market interest rate.

We do RRSP mortgage on other people's property, and others do for our properties.

 

[Thomas Beyer]

Yes you can but it has to be CMHC insured and the interest rate be a market rate so 2-3%. As such not the best use of funds but it can be done , absolutely . Not every RRSP trustee does it so click and phone around to see what their initial and ongoing fees are.

 

[GaryW]

Pick up Greg Habstritt's "The RRSP Secret" book, as he touches on this topic as well, but it's mostly arms-length borrowing and lending.

 

[zarmas01]

Thanks everyone, I think I have some more digging and reading to do on this topic. Certainly a good tool for real estate investors.

Just one more question, are the rules different from province to province?

 

[Thomas Beyer]

Use banks for a cheap 2% mortgage

Invest your own money at 5-8% tax free elsewhere

 

[nickytu]

We always can use a rrsp second mortgage!

 

[Matt Crowley]

Withdrawing the RRSP cash is probably not a great plan but borrowing against it and using it as security for the loan may be an affordable way to access the cash. Calum Ross had a article on this a couple of months ago.

Any chance this is your first house? Some amazing programs out there right now to access that RRSP cash.

 

[zarmas01]

Thanks SweetZone, this not my first house therefore I can't take advantage of first time home buyer plan. I am just exploring some options for my RRSP money which is just sitting in the bank account.

Would you mind sharing the link to that article from Calum Ross if you have it?

 

[Matt Crowley]

Titled post "No down payment no problem" http://blog.reincanada.com/no-down-payment-no-problem

Financial Post article (pros / cons) http://business.financialpost.com/p...ld-you-withdraw-from-your-rrsp-to-buy-a-house

Calum's blog: http://www.calumross.com/blog/bank-rates/wise-borrow-catch-rrsp-room/

 

[Tina Myrvang]

Titled post "No down payment no problem" http://blog.reincanada.com/no-down-payment-no-problem

Financial Post article (pros / cons) http://business.financialpost.com/p...ld-you-withdraw-from-your-rrsp-to-buy-a-house

Calum's blog: http://www.calumross.com/blog/bank-rates/wise-borrow-catch-rrsp-room/

Thank you Sweet Zone, you are my new best friend!!!!