Most buyers think the down payment is the hard part. They are wrong. A canadian minimum down payment mortgage is only the entry ticket. The real issue is whether your deal fits Canada-only financing rules, default insurance rules, lender policy, and the cash you still need to close in Ontario. That is the part we sort out every day as a Toronto mortgage broker with access to 35+ lenders.
Minimum Down Payment in Canada: The Short Answer
Yes, Canada has a standard minimum down payment framework for most insured owner-occupied purchases. The common rule is 5% on the first $500,000 of the purchase price, then 10% on the portion from $500,000 to $1.5 million. At $1.5 million or more, buyers generally need at least 20% down because default-insured financing is generally unavailable at that price point. This is a Canada-only guide. It is not about U.S. FHA, VA, Fannie Mae, Freddie Mac, or so-called 3% conventional loan products.
No, your realtor, your seller, or your lawyer does not set your down payment. Your lender and, if applicable, a mortgage default insurer set those financing rules. That is our side of the table. At Turkin Mortgage we structure the file, match it to the right lender program, and tell you the exact verified cash figure before you sign an offer. If you want that number first, start with a mortgage pre-approval in Toronto rather than a guess. If the whole concept is new to you, read our plain-language explainer on what a down payment on a house actually is.
Minimum Down Payment by Purchase Price: Canada Table
Yes, the fastest way to understand the amount needed for down payment on house purchases is to run the federal formula against the price. Here is the minimum for common price points.
| Purchase price | Minimum down payment | Typical result |
|---|---|---|
| $300,000 | $15,000 | Usually insured mortgage if under 20% down |
| $450,000 | $22,500 | Usually insured mortgage if under 20% down |
| $500,000 | $25,000 | Usually insured mortgage if under 20% down |
| $600,000 | $35,000 | Usually insured mortgage if under 20% down |
| $750,000 | $50,000 | Usually insured mortgage if under 20% down |
| $800,000 | $55,000 | Usually insured mortgage if under 20% down |
| $1,000,000 | $75,000 | Usually uninsured if 20%+ down; may still be insured if otherwise eligible under current rules |
| $1,500,000 | $300,000 | Generally uninsured; 20% minimum commonly required |
No, the minimum is not always the smart number to use. We tell buyers to compare 5%, 10%, and 20% down before they sign, because the amount needed for house down payment changes your monthly payment, your insurance premium, and your closing-day cash buffer. Run the three scenarios yourself in our purchase calculator for Ontario and Canada, then check the payment impact in our mortgage calculator.
When Do You Need CMHC or Other Mortgage Default Insurance?
Yes, if your down payment is under 20%, mortgage default insurance is generally required for an eligible high-ratio mortgage in Canada. Buyers say “CMHC” as shorthand, but CMHC is not the only insurer. Lenders may also work with other mortgage default insurers, and each insurer has its own eligibility rules. Part of our job is knowing which lender and which insurer combination your file actually fits.
Yes, if you want to generally avoid the mortgage default insurance premium, the usual threshold is 20% down or more. That is the answer most people mean when they ask what down payment do you need to avoid CMHC. The catch is that lender policy still matters. Some files with 20% down are treated differently for lender risk reasons, and the exact structure depends on the property, borrower profile, and lender program. This is exactly where a broker beats a single bank branch: one bank shows you one policy, we compare many.
No, mortgage default insurance is not the same thing as title insurance or homeowner’s insurance. Default insurance protects the lender against borrower default. Title insurance protects against title defects, fraud, and certain survey or registration issues. Property insurance covers physical loss to the home.
How Mortgage Default Insurance Premiums Work
Yes, the premium is generally calculated as a percentage of the mortgage amount, not the purchase price. The lower your down payment, the higher the loan-to-value ratio, and usually the higher the premium band. Premium tables change, so confirm the current numbers with your broker or the insurer calculator before you commit. Self-employed borrowers should also read our breakdown of mortgage insurance rates for a self-employed mortgage, because premium bands can differ when income is documented differently.
Yes, the premium is commonly added to the mortgage principal rather than paid in one lump sum. In Ontario, the provincial sales tax on that premium is generally payable at closing and is not usually rolled into the mortgage. Buyers miss this all the time. It is not the biggest closing item, but it is real cash due on closing day.
No, the premium is not a legal fee or a routine closing disbursement. It belongs to the financing side of your deal, which is why we show it separately from land transfer tax, title insurance, registration costs, and adjustments when we build your cash-to-close estimate with our Ontario closing costs calculator.
Insured vs Uninsured vs Conventional Mortgage in Canada
Yes, in Canada, an insured mortgage usually means a mortgage with default insurance because the down payment is below 20% or the product otherwise requires insurance. An uninsured mortgage usually means no default insurance premium is charged to the borrower because the file falls outside that structure, often with 20% or more down. If you want the wider map of products, see our guide to how many types of mortgages there are in Canada.
Yes, “conventional mortgage” in common Canadian usage usually means 20% or more down. That is why conventional down payment requirements in Canada are usually described as 20% minimum. Do not import U.S. search results here. Conventional 97, 3% down conventional, Fannie Mae, and Freddie Mac are U.S. concepts. They do not set standard Canadian mortgage rules down payment requirements. If you are a Canadian actually buying south of the border, that is a separate product line: see U.S. mortgages for Canadians, where 20% down is the common starting point.
| Mortgage type | Down payment | Default insurance premium | Typical use |
|---|---|---|---|
| Insured | Less than 20% | Usually yes | Buyers entering sooner with lower cash down |
| Uninsured | Often 20% or more | Usually no borrower-paid premium | Buyers with larger down payment |
| “Conventional” in Canada | Commonly 20% or more | Usually no borrower-paid premium | Same practical category as many uninsured files |
No, 20% down does not guarantee a lender says yes. We have seen buyers assume the conventional home loan minimum down payment is the whole test. It is not. Income, debts, credit, property type, and lender policy can still kill the approval. When an A lender declines a strong buyer on policy rather than on numbers, the answer is often a B-lender mortgage in Toronto or a private mortgage lender for a short bridge, not a bigger down payment.
Condo Down Payment Requirements in Canada and Ontario
Yes, the condo down payment requirement usually follows the same federal purchase-price formula as a house. A $500,000 condo still has a minimum down payment of $25,000. A $600,000 condo still has a minimum of $35,000. The statutory minimum does not increase just because the unit is a condo. The financing itself, however, is not identical, which is why we treat condos as their own conversation inside residential mortgages in Toronto.
Yes, condo fees can reduce how much mortgage you qualify for even though they do not usually change the minimum down payment itself. Lenders and insurers factor common expenses into affordability calculations. That is why two buyers with the same income can qualify very differently for a freehold house and a downtown condo. You can see that effect in dollars using our required income calculator.
Yes, Ontario condos add checks that freeholds do not. Your real estate lawyer reviews the status certificate, which is the condo corporation’s disclosure package. Lenders read it too, and they look for arrears, lawsuits, reserve fund problems, special assessments, and occupancy fee issues on pre-construction units. We have seen a last-minute special assessment wipe out a buyer’s closing cushion in the $10,000 to $30,000 range, and we have seen lenders re-price or re-condition a file because of it. Flag the building early and we will check lender appetite before you spend money on conditions.
Owner-Occupied, Second Home, Rental, and Multi-Unit Property Rules
No, the same down payment rule does not apply cleanly to every property use. Owner-occupied homes usually have the broadest access to high-ratio insured financing. Second homes, rentals, and multi-unit properties can face tighter rules, higher minimum equity requirements, or narrower insurer eligibility. In practice that means different pages of the rulebook for an investment property mortgage, a vacation or second-home mortgage in Canada, and a commercial mortgage in Toronto once the unit count crosses into commercial territory.
Yes, the biggest mistake here is assuming a rental duplex is financed the same way as a principal residence. It may not be. Unit count, occupancy, and whether you will live in one unit can all change the file. Confirm that before you waive financing conditions. We have seen buyers lose one to two weeks reworking financing because the property was classified differently than they assumed.
No, we will not give a fake universal number for every investment and multi-unit purchase because insurer and lender rules move. The concrete point is this: property use and unit count can change both the minimum cash required and whether default insurance is available at all. Send us the listing and the intended use before you sign, and we will confirm the real minimum for that specific property.
Can You Use Gifts, RRSPs, FHSA, Savings, or Borrowed Funds?
Yes, personal savings, gifted funds, RRSP withdrawals through the Home Buyers’ Plan, FHSA funds, TFSA savings, and sale proceeds are all common sources of down payment money in Canada. The current Home Buyers’ Plan withdrawal limit is up to $60,000 per qualifying buyer. The FHSA annual contribution room is up to $8,000, with a lifetime limit up to $40,000. Which of these a lender will accept, and in what form, is the part worth checking early — see our first-time home buyer mortgage guide for Ontario.
No, you do not need to be a first-time buyer to get an insured mortgage. First-time buyer status matters for some savings programs and tax rebates, not for the basic existence of CMHC-style default insurance itself.
Yes, gifted funds are often accepted if they are properly documented. Lenders usually want a signed gift letter and a paper trail showing the money in your account before closing. Last-minute unexplained transfers are a problem. We see them delay closings every year. If the gift comes from family who also want to be on the deal, the structure changes again: read co-signing a mortgage in Canada and 3-person mortgages in Canada.
Maybe borrowed funds can count in some structures, but we would not treat that as a planning assumption. Borrowed down payment rules are lender- and insurer-specific. The safe move is to clear that with your broker before you make the offer. The same goes for less traditional sources — if your money is in digital assets, see crypto down payments in Canada before you assume a lender will take it.
Yes, buyers should keep a source-of-funds file. The usual documents are 90 days of bank statements, gift letters, RRSP withdrawal records, FHSA statements, and proof of sale proceeds if another property is funding the purchase. Our full mortgage document requirements checklist for Canada lists everything a lender will ask for, and newcomers with limited Canadian history should start with newcomer mortgage programs, which can start at 5% down.
What Else Do You Need Besides the Down Payment? Ontario Closing Cash Checklist
No, the down payment is not your total cash to close. In Ontario, buyers also need to budget for land transfer tax, legal fees, disbursements, title insurance, adjustments, and sometimes appraisal, inspection, lender, moving, and utility setup costs.
Yes, a broad planning range for Ontario closing costs beyond the down payment is often about 1.5% to 4% of the purchase price, depending on price, location, rebates, and the file. Toronto buyers can land at the higher end because Toronto has a municipal land transfer tax on top of Ontario land transfer tax. Price your own number with our land transfer tax calculator for Canada and our closing costs calculator for Ontario.
Yes, adjustments are one of the most missed items. Adjustments are reimbursements to the seller for prepaid amounts such as property taxes, condo fees, or fuel oil. On some files they are a few hundred dollars. On others they run into the low thousands. Builder adjustments on new construction can be much worse.
Yes, this is where the financing side earns its keep. Your lawyer registers the transfer, searches title, and reconciles the statement of adjustments. We work the other half: we confirm the lender commitment holds, watch appraisal and condition risk, keep the approved funds matched to your closing date, and make sure the cash you were told to bring is the cash you actually need. When those two halves are not talking to each other, that is when closing week goes sideways.
Get Your Real Number Before You Waive Conditions
If you are making an offer or getting ready to close in Toronto, the GTA, or anywhere in Ontario, get your financing figures reviewed before your financing condition disappears. We will confirm your minimum down payment, your insurance premium, your qualifying amount, and your realistic cash to close — usually the same day. Apply online in about 10 minutes, or talk to a Turkin Mortgage broker at 647-938-8808. No cost, no obligation, and no credit hit for the first conversation.
Worked Ontario Examples: How Much Cash You Need to Close
Yes, worked examples are the only way most buyers understand how the amount of down payment needed to buy a house connects to real closing cash. These are planning examples, not quotes. Land transfer tax, rebates, lender requirements, and adjustments can change the final number, so confirm yours in our Ontario mortgage calculators.
Yes, a $500,000 condo in Toronto with the minimum down payment starts at $25,000 down. Add Toronto and Ontario land transfer tax, legal and title costs, adjustments, and a reserve for moving or setup. A realistic total cash target can land roughly in the $35,000 to $50,000 range depending on rebates and the file. Buyers who budget only the down payment are usually short.
Yes, a $600,000 home in Ontario outside Toronto starts at $35,000 down. Add Ontario land transfer tax, legal and title costs, and an adjustments cushion, and the total cash required often lands roughly in the $45,000 to $60,000 range. Inside Toronto, the extra municipal land transfer tax can push that meaningfully higher.
Yes, a $1,000,000 purchase under the standard tier formula starts at $75,000 down, but plenty of buyers choose 20% down to avoid the borrower-paid default insurance premium. At 20%, the down payment is $200,000. Once you add tax, legal costs, title insurance, adjustments, and a reserve, total cash can easily land in the $210,000 to $240,000 range outside Toronto and higher in Toronto.
Does 20% Down Always Make More Sense?
No, 20% down is not automatically the best choice. It usually avoids the borrower-paid default insurance premium, lowers the loan balance, and reduces monthly carrying costs. But it also ties up more cash. We tell clients to keep liquidity if the purchase already stretches them.
Yes, 5% down can make sense if entering the market sooner matters more than waiting to save. Yes, 10% down can be a middle ground. Yes, 20% down can make sense if you want lower payments and no borrower-paid default insurance premium. The right answer is usually a trade-off between monthly payment, total interest, insurance cost, and how much emergency cash you keep after closing. Two other levers move the same numbers: the rate you get, so compare the best mortgage rates in Ontario and our current mortgage rates, and the amortization, where a 30-year mortgage in Canada can lower the monthly payment when the file qualifies.
No, you should not drain every account to hit 20%. We have seen closings go sideways over a $3,000 to $8,000 shortfall caused by land transfer tax, adjustments, or a lender condition the buyer did not expect.
New Construction and Pre-Construction: Is a Deposit the Same as a Down Payment?
No, a builder deposit is not always the same as your final mortgage down payment. A pre-construction agreement may require staged deposits over months or years, while your lender measures the mortgage file closer to final closing.
Yes, Ontario pre-construction condos often have two different milestones: interim occupancy and final closing. Occupancy happens when you can move in but title has not transferred yet. Final closing is when title transfers and the mortgage funds. Buyers confuse these stages all the time.
No, meeting the builder’s deposit schedule does not guarantee you satisfy lender or insurer rules later. Values, income, rates, and lender policy can all change before final closing. We have seen buyers fully current on deposits and still short tens of thousands on final closing because of builder adjustments and revised financing terms. If you are building rather than buying finished, the rules are different again: see construction mortgages in Toronto and construction and land financing. If the home you want needs work, a purchase-plus-improvements mortgage can fund renovations inside the mortgage instead of out of your closing cash.
Qualification Basics: Income, GDS/TDS, Credit, and Stress Test
No, minimum down payment does not equal mortgage approval. Lenders still review income, employment, debts, credit history, taxes, heating costs, and the property itself. Our walkthrough of the mortgage pre-approval process shows what actually gets checked and in what order.
Yes, GDS and TDS are debt-service ratios lenders use to measure affordability. A commonly cited benchmark for insured files is GDS up to 39% and TDS up to 44%, but lender policy can be tighter. Confirm the current standard on your application rather than relying on a generic chart, and see how the math lands in mortgage as a percentage of income.
Yes, Canada also uses a mortgage stress test. The common test is the greater of the contract rate plus 2% or the applicable benchmark rate. That is one reason a buyer can have the right down payment and still be denied. Credit is the other quiet killer — see how credit scores influence your mortgage rate.
Yes, some borrower profiles need a different lender rather than a bigger down payment. Business owners writing off income should read self-employed mortgages in Toronto and how to get a mortgage when self-employed. Buyers with bruised credit or non-traditional income can still buy with less than 20% down in many cases, but often through subprime and B-lender mortgages in Canada. Buyers separating from a partner should start with divorce mortgages in Canada, because the equity and the qualifying picture both change.
Common Mistakes Buyers Make With Down Payments
Yes, the most common mistake is assuming the down payment is the only cash required. In our experience, that is the mistake that creates the worst closing-week panic.
Yes, undocumented gifts and last-minute transfers are another repeat problem. If your lender cannot trace the money, your approval can stall even if the amount itself is enough.
Yes, condo buyers often confuse the deposit they paid to the builder with the final down payment their lender needs. Those are related numbers, but they are not always the same legal or financing concept.
Yes, buyers also assume 20% down solves everything. It does not. Title issues, appraisal shortfalls, discharge problems on the seller side, and condo document surprises can still delay or derail closing.
Yes, the last one is shopping a price before shopping a mortgage. Buyers fall in love with a listing, then discover the qualifying amount does not match. A few of our tips for a stress-free homebuying experience exist purely to prevent that order of operations.
Glossary: CMHC, High-Ratio Mortgage, LTV, GDS, TDS, and Stress Test
Yes, CMHC is Canada Mortgage and Housing Corporation, one of the entities associated with mortgage default insurance in Canada.
Yes, a high-ratio mortgage usually means a mortgage with less than 20% down and therefore generally requires default insurance.
Yes, loan-to-value, or LTV, is the mortgage amount divided by the property’s value or purchase price. Higher LTV usually means less equity and higher insurer risk.
Yes, GDS means gross debt service, and TDS means total debt service. They are affordability ratios used by lenders and insurers.
Yes, the stress test is the qualifying rate framework lenders use to check whether you could still afford the mortgage at a higher rate than your contract rate.
FAQ
What is the minimum down payment in Canada?
Yes, for many eligible purchases, it is 5% on the first $500,000 and 10% on the portion from $500,000 to $1.5 million. At $1.5 million or more, buyers generally need at least 20% down.
How much down payment do I need for a $500,000 home in Canada?
Yes, the minimum is $25,000.
What down payment do I need to avoid CMHC?
Yes, generally 20% or more if you want to avoid the borrower-paid mortgage default insurance premium.
Do I need 20% down to buy a house in Ontario?
No, not always. Many eligible buyers can buy with less than 20% down if the mortgage qualifies for default-insured financing. A pre-approval confirms which tier you fall into.
Can I buy a house in Canada with no down payment?
No, zero-down purchases are not the standard Canadian rule. Buyers should assume they need real verified funds for the minimum down payment and closing costs.
What is the minimum down payment for a condo in Ontario?
Yes, the same federal formula usually applies. A $500,000 condo needs at least $25,000 down.
How much down payment do I need for a $600,000 house in Ontario?
Yes, the minimum is $35,000.
Can I use gifted money for my down payment in Canada?
Yes, often, if the lender accepts it and the gift is properly documented.
Can I use my RRSP or FHSA for a down payment?
Yes, many buyers do. The current Home Buyers’ Plan limit is up to $60,000 per qualifying buyer, and the FHSA has annual room up to $8,000 with lifetime room up to $40,000.
What costs do I need besides the down payment?
Yes, plan for land transfer tax, legal fees, disbursements, title insurance, adjustments, and other moving parts. A broad Ontario planning range is often 1.5% to 4% of the purchase price beyond the down payment. Our closing costs calculator gives you a file-specific estimate.
Does 20% down mean I will never pay mortgage insurance?
No, it usually avoids the borrower-paid default insurance premium, but lender policy can still differ by file.
Do condo fees affect mortgage qualification in Canada?
Yes, they usually affect affordability calculations even if they do not change the statutory minimum down payment.
Is CMHC only for first-time home buyers?
No, default-insured mortgages are not limited to first-time buyers.
Is a builder deposit the same as a down payment?
No, not always. Builder deposits are contract payments to the builder. Your mortgage down payment is measured against lender and insurer rules closer to final closing.
How much total cash do I need to close on a home in Ontario?
Yes, more than the down payment. A practical planning target is your down payment plus roughly 1.5% to 4% of the purchase price for closing costs, with Toronto often higher because of municipal land transfer tax.
Can a mortgage broker get me approved with less down than my bank wants?
Yes, sometimes. Minimum down payment rules are federal, but lender overlays are not. One lender may want more equity for your property type or income structure while another does not. That is the whole reason we shop 35+ lenders instead of one.
Talk to a Toronto Mortgage Broker Before You Sign
If you are close to making an offer, the next step is simple: get your real lender numbers and your closing-cost assumptions lined up before you waive conditions. Turkin Mortgage is an independent, FSRA-licensed brokerage (FSRA #13530) with offices in Toronto, Markham, and Midland, and we compare 35+ lenders to find the down payment structure that costs you the least over the full term — not just the lowest number on closing day.
Apply online now and get your down payment and cash-to-close numbers confirmed, get pre-approved, or call 647-938-8808 and speak with a licensed broker today. You can also send us your deal details and we will come back within one business day.
