Will you live in the home? If the house will be owner-occupied, then you need 5% down for the first $500,000 of the purchase price, and 10% for any amount over $500,000 up to $999,999. If the purchase price is $1,000,000 or more, the minimum down is 20%.
Hoping to skip the cost of mortgage default insurance? Then you'll need at least 20% down. Any downpayment less than 20% of the purchase price requires this insurance, which will be added to your mortgage principal.
Buying a rental or recreational property?If it's not going to be your own principal residence, then you'll need 20% down. Genworth and CMHC have a vacation/second home program that allows you to put 5% down but mortgage default insurance will be required. Rental properties require 20% down.
Are you new to Canada? If you're a permanent resident, then you'll need the same downpayment as a Canadian citizen: 5% for the first $500,000 and 10% after that. If you are a non-permanent resident, then you may need 10% down. And if you're not a resident of Canada, then you'll need at least 35% down from your own resources (not borrowed).
Smart ways to come up with a downpayment
If you're looking to buy a second home, then your best path to a downpayment is often to refinance your existing home. A review of your situation is the best starting point.
If you're saving for your first home, here are some ways to come up with the cash:
Often homebuyers are actually closer than they think to buying that first or next property.
** This information is current as of May 7, 2019, and lending practices are subject to change at any time.
Source: Invis Financial
The Lowdown on Downpayments
Posted in: Mortgage News