August 7, 20263 min read
This is one of the most useful questions to answer early in the mortgage process. Canada uses minimum down-payment rules based on purchase price, but the amount you should bring to closing can be higher once closing costs and lender requirements are considered.
The factors that change the answer
Here is what matters most:
- For homes priced at $500,000 or less, the federal minimum is generally 5% of the purchase price.
- From $500,000 to $1.5 million, the minimum is generally 5% of the first $500,000 plus 10% of the portion above $500,000.
- At $1.5 million or more, the minimum down payment is generally 20%.
- If your down payment is below 20%, mortgage default insurance is typically required, subject to insurer and lender eligibility.
In Ontario, budget separately for items such as legal fees, adjustments and land transfer tax rather than using every available dollar for the down payment.
Want this applied to your own numbers?
Call Phil Cragg at 866-349-4915 or request a written comparison.
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