Down Payments: How Much You Need and How to Prove It

The short answer: The minimum depends on the purchase price. Lenders can ask for more based on the property or your application.

 

Minimum down payment

• Up to $500,000: Minimum down payment: 5%.

• $500,000 to $1.5 million: Minimum down payment: 5% of the first $500,000, plus 10% of the rest.

• $1.5 million or more: Minimum down payment: 20%.

Example: On an $800,000 home, the minimum is $25,000 (5% of $500,000) plus $30,000 (10% of $300,000), for a total of $55,000, before closing costs.

 

Under 20% down means mortgage insurance

If you put down less than 20%, you'll generally need mortgage default insurance. It protects the lender, not you, and it's different from home insurance.

 

Prove where it came from

Lenders want to see the source of your down payment:

• Savings: usually 90 days of statements

• Sale of a property or investments: the paperwork

• A gift from family: a signed gift letter and proof of transfer

A loan from family that you have to pay back isn't a gift. Large deposits will need an explanation, so don't move money around between accounts more than you need to.

 

Don't use every dollar

A bigger down payment means a smaller mortgage, but keep some cash back for closing costs, moving and the unexpected.

 

Related guides

• First-Time Home Buyers

• Closing Costs

• Mortgage Pre-Approval

 

Let's talk it through

Book a call and we'll go over your options with you.

Alberta: 587-900-0036 | BC: 604-200-3228

 

These guides are general information, not a mortgage offer or personal advice. Every approval depends on lender review of your income, credit, property and documents. Elevate Lending, powered by BRX, serves clients in Alberta and British Columbia.