How much do I need for a down payment?
The minimum is tiered: five percent on the first portion of the price, ten percent on the portion above it, and twenty percent once the price passes the insurable cap. The calculator gives you the exact figure for your price.
Minimums are set by the rules governing mortgage default insurance, not by individual lenders. They step up with price, and above the insurable cap no insurance is available at all, which makes twenty percent the floor rather than a preference.
Below twenty percent your mortgage must be insured. That adds a premium to your loan balance and, in Ontario, Ontario retail sales tax on that premium which you pay in cash on closing. It also gives you access to insured pricing, which is usually lower than uninsured pricing, so a smaller down payment is not uniformly worse.
Separately, a lender needs to see where the money came from. Expect to document ninety days of history on every account holding it, and to provide a signed gift letter for anything gifted.
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Get the exact minimum for your priceAlso asked as
- What is the minimum down payment in Ontario?
- Can I buy with 5% down?
Next questions
Is putting twenty percent down always better?
No. Twenty percent avoids the insurance premium and its sales tax, but insured mortgages are often priced below uninsured ones, and draining your reserve to reach twenty percent is a trade you should price rather than assume.
Canada-wide
What is mortgage default insurance and who does it protect?
It protects the lender, not you. It is required below twenty percent down, the premium is added to your mortgage, and in Ontario the retail sales tax on that premium is cash you pay on closing.
Canada-wide
Can I use my RRSP or FHSA for a down payment?
Yes to both, and they work differently. A Home Buyers' Plan withdrawal from an RRSP must be repaid over fifteen years; an FHSA withdrawal for a qualifying home is not repaid and not taxed.
Canada-wide