What happens if you miss a repayment
Each year's minimum repayment (withdrawal ÷ 15) that you don't put back into your RRSP gets added to your taxable income for that year instead — it isn't a debt collector situation, but it does mean paying income tax on the shortfall as though it were regular income. Repaying more than the minimum in any year reduces your remaining balance and future minimum payments, similar to making extra payments on a loan, though there's no requirement or incentive structure pushing you to do so beyond the tax consequence of falling behind.
How the withdrawal itself works
To use the HBP, you withdraw funds from your own RRSP — the money has to have been sitting in the account for at least 90 days before withdrawal to qualify, which matters if you're making a last-minute contribution specifically to fund a down payment. The withdrawal itself is tax-free at the time you take it out, which is what makes it attractive as a down payment source compared to simply cashing out RRSP savings normally, which would trigger immediate income tax and withholding.
Why the repayment schedule is a flat amount, not compound interest
Unlike a loan, the HBP doesn't charge interest — your repayment obligation is simply the amount you withdrew, divided evenly across 15 years, with no growth or interest cost. This calculator shows that flat annual figure directly. The trade-off is opportunity cost, not interest: money withdrawn from your RRSP isn't invested and growing tax-deferred during the years before you repay it, which is a real cost even though it's not itemized as separately as interest would be on a conventional loan.
Using the HBP more than once
It's possible to use the HBP again for a future home purchase, but only once your previous HBP balance has been fully repaid and you meet the first-time buyer criteria again (generally not having owned a home you lived in for the four preceding years) — it isn't a program you can tap repeatedly while still repaying an earlier withdrawal.
Combining this with an FHSA? Check the FHSA calculator to see your full tax-advantaged down payment total, since the two programs are designed to work together rather than as alternatives to each other.