1) Sean and Lilly are looking to purchase their first home together in Montréal and were thrilled when they heard that their offer of $295,000 was accepted. It was only when they calculated some other amounts that were needed that panic set in. As they only have 5% as a down payment, they are required to purchase mortgage loan insurance from the Canada Mortgage and Housing Corporation (CMHC) at 4% of the mortgage. In addition, they need to pay Transfer Duties (also called "Welcome Tax"). As they barely scrapped enough money for the down payment, they do no know how they will come up with these amounts. How much is the total needed to cover their transfer duties under the city of Montréal and CMHC mortgage loan insurance? (Note they have decided to pay the loan insurance as a lump sum versus adding it to their mortgage payments). The transfer duties for properties in Montréal are calculated as follows. Rate per bracket - 2020 fiscal year : On that part of the basis of imposition Which does not exceed $51,700 Which is in excess of $51,700 but does not exceed $258,600 Which is in excess of $258,600 but does not exceed $517,100 Which is in excess of $517,100 but does not exceed $1,034,200 Which is in excess of $1,034,200 but does not exceed $2,000,000 Which exceeds $2,000,000 Rate 0.5 % 1.0 % 1.5 % 2.0 % 2.5 % 3.0 % a) $13,329.67 b) $14,083.50 c) $12,909.32 d) $14,673.50 e) $13,767.89
1) Sean and Lilly are looking to purchase their first home together in Montréal and were thrilled when they heard that their offer of $295,000 was accepted. It was only when they calculated some other amounts that were needed that panic set in. As they only have 5% as a down payment, they are required to purchase mortgage loan insurance from the Canada Mortgage and Housing Corporation (CMHC) at 4% of the mortgage. In addition, they need to pay Transfer Duties (also called "Welcome Tax"). As they barely scrapped enough money for the down payment, they do no know how they will come up with these amounts. How much is the total needed to cover their transfer duties under the city of Montréal and CMHC mortgage loan insurance? (Note they have decided to pay the loan insurance as a lump sum versus adding it to their mortgage payments). The transfer duties for properties in Montréal are calculated as follows. Rate per bracket - 2020 fiscal year : On that part of the basis of imposition Which does not exceed $51,700 Which is in excess of $51,700 but does not exceed $258,600 Which is in excess of $258,600 but does not exceed $517,100 Which is in excess of $517,100 but does not exceed $1,034,200 Which is in excess of $1,034,200 but does not exceed $2,000,000 Which exceeds $2,000,000 Rate 0.5 % 1.0 % 1.5 % 2.0 % 2.5 % 3.0 % a) $13,329.67 b) $14,083.50 c) $12,909.32 d) $14,673.50 e) $13,767.89
Chapter9: Obtaining Affordable Housing
Section: Chapter Questions
Problem 1FPC
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Transcribed Image Text:1) Sean and Lilly are looking to purchase their first home together in Montréal and were thrilled
when they heard that their offer of $295,000 was accepted. It was only when they calculated
some other amounts that were needed that panic set in. As they only have 5% as a down
payment, they are required to purchase mortgage loan insurance from the Canada Mortgage
and Housing Corporation (CMHC) at 4% of the mortgage. In addition, they need to pay Transfer
Duties (also called "Welcome Tax"). As they barely scrapped enough money for the down
payment, they do no know how they will come up with these amounts. How much is the total
needed to cover their transfer duties under the city of Montréal and CMHC mortgage loan
insurance? (Note they have decided to pay the loan insurance as a lump sum versus adding it
to their mortgage payments).
The transfer duties for properties in Montréal are calculated as follows.
Rate per bracket - 2020 fiscal year :
On that part of the basis of imposition
Rate
0.5 %
Which does not exceed $51,700
Which is in excess of $51,700 but does not exceed
$258,600
Which is in excess of $258,600 but does not exceed
$517,100
Which is in excess of $517,100 but does not exceed
$1,034,200
Which is in excess of $1,034,200 but does not exceed
$2,000,000
Which exceeds $2,000,000
1.0 %
1.5 %
2.0 %
2.5 %
3.0 %
a) $13,329.67
b) $14,083.50
c) $12,909.32
d) $14,673.50
e) $13,767.89
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