This is a bit of a warning based on my own experience, but also if anyone can help in my situation that would be appreciated.

Basically we set up an FHSA account and got "locked in" with a non redeemable account. Now that we want/need to redeem our money, we are getting penalized for a decent sum of money. Yes, we made a mistake while opening the account but there was no indication by the representative that we would be locked in the way we are. As someone who isn't the most financial/bank savvy, I feel we were taken advantage of in a sleazy way.

When we opened the account the BMO representative asked when we were planning on buying. I said "maybe around 2-5 years" my partner disagreed with me and stated "probably 1 year"after the disagreement my partner said "yeah, whatever, 2-5 sounds fine". Everything else during the meeting went smoothly. I feel I need to state that there was no mention of being locked in or being penalized for needing to take our money out of the account.

Fast-forward about 8 months we found a house that is perfect (for us) and purchase it. The closing date is still in a month but we need to get our cash out. After having a meeting and learning that we will be penalized, I asked where the info was on how we're getting charged. The rep called a GIC line who said "oh we just type it in a calculator and it spits it out" (the rep put the GIC line on speaker and it was as off-handed as I stated here). Alright cool. The rep pleaded with the banks manager who put her foot down and said "nope nope, in the notes it says they were looking to buy in 2-5 years so they have to pay". I guess the notes didn't include the fact that my partner and I disagreed on this and it was clear that we didn't have a particular set date in mind. If we had known there was a penalty involved we would have thought about it harder.

Anyways, I refused to pay, the bank still has my money. I ended up calling CRA to figure out what they would say. I have the reps badge number and name (for record keeping purposes). The CRA rep stated that we should get the principle amount back, with no penalty, but we may not get any gained interest. I also went ahead and contacted a competitor bank as I have a friend there (CIBC) who said the same thing. Well, first they started with "they shouldn't have used a nonteddemable GIC as you may need that money at any time to purchase a home" and then added "our rules would be to give you the principle back".

I went ahead and called BMO back and the manager is refusing to budge even in light of the new CRA information. She said I'll just have to file a complaint. So I have.

So anyways, long story short - be wary of BMO sleazy tactics as they don't have your best interests in mind (obviously). If anyone has any idea.on how I can connect BMO with CRA to follow the governments own rules please let me know.