Mini-CaseC:(3.5marks)

Amanda and Jeff just received the call that theiroffer of $325,000was acceptedon aMontrealdreamhome! They know money will be tight since it took all their savings for a 10% down payment. Costs are however adding up, which is making them nervous. The Canada Mortgage Housing Corporation (CMHC) mortgage loan insurance premium is 3.10% of the mortgage amount which they have decided to pay at the time of closing instead of adding it to their monthly mortgage. Other fees include a $450 appraisal fee, a $750 home inspection fee, $1,550 notary fees, land transfer tax (sometimes known as the "Welcome tax"or "Transfer duties"- see table below) and $850 for title insuranceand homeowner's insurance of $1,000.

http://ville.montreal.qc.ca/portal/page?_pageid=44%2C80257&_dad=portal&_schema=PORTAL

a)How much will Amanda and Jeff need to cover at closing including the down-payment?

(1.5marks)

Calculation: (1.5marks)

b)Amanda and Jeff do not have a ____________________ mortgage as they do not have the 20% down payment.(.5 mark)

c)For their down payment, Amanda and Jeff will be withdrawing from their_____________________________under the________________________where they can "borrow" up to $35,000. (see Table E)(.5marks-.25 marks each)

d)Amanda and Jeffhave up to______years to reimbursetheirwithdrawalin c) with aminimum amount neededto reimburseevery year under the plan. The first repayment can be made no later than_______________________of the 2nd year following the yeartheymakethe withdrawal. It's also important to note that the repayment cannot be deducted fromtheirtaxable income whentheyfiletheirincome tax return but ifeither one of themfails to reimburse the minimum amount required,theywill betaxedon that amount.(1 mark-.5 marks each)

Mini-CaseD:(2.5marks)

Alina's bank just called as she submitted a bank application for a mortgage. Her gross annual income is $130,000. Her monthly heating would be $375, condo fees of $550 per month, and annual property taxes would be $3,750 along with monthly debt payments of $1,565.

a)Given the bank has calculatedAlina'sGross Debt Service (GDS) ratio as 31%, how much is her monthly mortgage payment?(1mark)

Calculation: (1mark)

b)Alina is planning on withdrawing thedown paymentfrom her Tax-Free Savings Account(TFSA)for thecondo that she is looking to purchase. Alina has contributed the maximum to her TFSA since turning 18 with contributions totaling $38,500. Themarket value ofherTFSA isnowat $75,230asshe has done well with her investments. Alinawill bewithdrawing$50,000on July 1, 2020from her TFSAfor the down payment,what is the earliest date thatAlinacanre-contribute to herTFSA without triggering penalties?(Highlight/underline your response)(.5 mark)

July 1, 2020(same day)or

August 1, 2020 (1 month later)or

July 1, 2021(1 year later)or

December 31, 2020 (end of the year)or

January 1, 2021(first day of the following year)

c)What is themaximumamount thatAlina canre-contribute to herTFSA on the dateyou selectedin b)without triggeringpenalties?(see Table C):(1mark)

Calculation: (.5mark)