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Subsidy Program

Our Mortgage Subsidy Program offers a potentially tax-effective mortgage interest rate buy-down for a maximum of 5 years. Allowable by the Canada Revenue Agency, Employers can buy-down the interest rate of their Employee's personal mortgage on their principal residence.

  • The cost of the full mortgage subsidy is potentially tax-deductible for the company.
  • Employees achieve a potential tax-effective interest rate buy-down resulting in lower monthly payments or a reduced mortgage amortization.

Your company can implement the Mortgage Subsidy Program as part of the existing benefits or as a stand-alone option, including Flex Benefits, Relocation or Compensation Enhancements (e.g. profit-sharing, defined contribution pension plans, RRSP's, stock purchase plans).

Our Group Mortgage Plan Provides Your Employees With:

  • Access to national mortgage lenders
  • Discounted mortgage rates
  • Lower monthly payments and therefore increased disposable income OR
  • A potentially tax-effective buy-down of mortgage principal when Employees maintain 100% of their mortgage payments

Mortgage Subsidy Options

To meet your company's needs Group Mortgage Plan has 4 subsidy options:

Flat Dollar

The Employer establishes a base dollar amount per Employee, per month, this amount would be applied to the Employee’s mortgage, regardless of current interest rates.

Paid monthly directly to Group Mortgage Plan.

Interest Rate Buy-Down

The Employer determines a percentage to subsidize (buy-down) the Employee's mortgage interest rate i.e., reduce rate by 2%.

As the mortgage ‘amortizes down’ so do the costs to your company.

Paid monthly directly to Group Mortgage Plan and recommended as the most cost-effective way to manage company's funds.

Annual Lump Sum

Employer establishes a base dollar amount per Employee on an annualized basis.

Paid directly to Group Mortgage Plan and we will apply on a per payment basis.

One-time Interest Rate Buy-Down

The Employer establishes a base dollar amount per Employee as a one-time upfront buy-down of the Employee’s mortgage interest rate.

Paid directly to Group Mortgage Plan before initial funding of mortgage and we will "buy-down" the Employee's interest rate for the full-term of the mortgage.

Comparison Of Mortgage Subsidy Options on a $200,000 Mortgage

Mortgage Amount
Current 5 Year Rate*
Subsidy Calculation
Subsidized Rate
Interest Paid by Employee to Term
Interest Savings For Employee for Term
Amortization Of Mortgage
Non Subsidized
25 years
With a Flat Dollar Subsidy
A specific amount is allotted per month for Employee to be paid toward the contract rate
5.05% rate subsidized by $100.00 per month
21 years and 5 months
With an Interest Rate Subsidy
Reducing the Employee rate to a specific amount
19 years and 9 months
With a Lump Sum Buy-down
$5000 provided up front as one lump sum is used to buy down the rate.
20 years and 2 months

*For illustrative purposes only.

Group Mortgage Subsidy Plan Benefits Include:

  1. Turn-key administration, plan is easy to implement and manage:
    • Dedicated account management and client administration for front and back-end related services.
  2. Group Mortgage Plan provides:
    • Quarterly taxable benefit reporting to each organization on an individual Employee basis.
    • Monthly subsidy billing.
    • Invoices each month for the interest subsidy amount.
    • Potentially a tax deductible expense for organizations.
    • If prescribed rate is lower than the set rate for a particular quarter, our system adjusts the rate accordingly.

To discuss your customized Group Mortgage Subsidy Plan contact our Group Mortgage Plan experts today.

Are you eligible for a subsidy?

Has your company asked you to relocate? Does your company have a mortgage subsidy program as part of your benefits? If yes, you may be eligible for a mortgage interest rate subsidy from your Employer.

Check your company's policies or benefit package to see if you are eligible for a mortgage interest rate subsidy.

Need To Know: An interest rate subsidy is a non-taxable benefit for the Employee and a tax deduction for the Employer. It's a win, win situation.