Mortgage Logic

How much do I need for a down payment?

It is possible to qualify for 100% financing that allows for a borrowed down payment. There are certain lenders / products in the market that offer this option and it depends upon your credit standing to determine what interest rate you would qualify for, as long as the payments for the borrowed down payment work within your qualifying debt service ratios. Call our us for details.

Down payments as small as 5% to buy a home are available from most lenders, with CMHC, Canada Guaranty or Genworth mortgage loan insurance, subject to certain maximum price restrictions. In addition to the down payment, you must also be able to show the ability to pay applicable closing costs (i.e. legal fees, prepaid property taxes, disbursements, appraisal, and survey certificate).

Your down payment is typically from your own savings (resources) or a gift from a family member. A gift letter signed by the donor is required that irrevocably forgives any claim to the gift. Mortgage Loan Insurance from Canada Mortgage and Housing Corporation (CMHC), requires that the gift money must be in the your possession before the application is sent to CMHC for approval. Mortgage Loan Insurance provided by Genworth, does not require that the gift money be in your possession until the closing date.

Mortgages with less than 20% down payment will require Mortgage Loan Insurance provided by CMHC, Genworth, Canada Guaranty or a lender’s own self insurance program.