How Much Down Payment Do I Need for a Mortgage in Canada: Complete 2025 Guide

How Much Down Payment Do I Need for a Mortgage in Canada?

If you're planning to buy a home north of the border, one of the first questions you'll ask is: how much down payment do I need for a mortgage in Canada? The answer depends on the purchase price, the lender, and whether the property is your primary residence. Canadian mortgage rules are stricter than many buyers expect, so understanding the minimum requirements upfront saves you time, money, and rejected applications.

Minimum Down Payment Rules in Canada

Canada's down payment requirements are tiered by home price. For homes priced under $500,000, the minimum is 5% of the purchase price. For the portion between $500,000 and $999,999, you need 10%, and for homes at $1 million or more, the minimum jumps to 20%.

Here's a practical example: on a $700,000 home, you'd pay 5% on the first $500,000 ($25,000) plus 10% on the remaining $200,000 ($20,000) — a total minimum down payment of $45,000.

When You Need 20% or More

A 20% down payment unlocks key advantages. It eliminates the Canada Mortgage and Housing Corporation (CMHC) insurance premium, which can add thousands to your mortgage. It also opens access to conventional lenders and often secures a lower interest rate. If you're self-employed, buying an investment property, or purchasing a home over $1 million, expect lenders to require at least 20%.

Down Payment Sources and Verification

Lenders verify every dollar. Acceptable sources include savings, RRSP withdrawals under the Home Buyers' Plan (up to $60,000 per person), gifts from immediate family, and proceeds from a home sale. Borrowed funds are generally not accepted for the minimum portion. Prepare a 90-day history of your accounts to avoid delays.

Conclusion

So, how much down payment do I need for a mortgage in Canada? At minimum, 5% on the first $500,000, 10% on the next tier, and 20% for homes over $1 million. Aim for 20% if you want to skip insurance premiums and secure better terms. Speak with a licensed mortgage broker to confirm your exact figure before you make an offer.

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