Last updated: July 10, 2026
In Canada, the minimum down payment for a house depends entirely on the purchase price [1.5]. For homes under $1.5 million, you can get started with as little as 5% to 10%, while properties priced over that threshold require at least 20% down.
The Minimum Down Payment Math in Canada
The rules for down payments are set by federal regulations, and they are structured in tiers. If your target home costs less than $1.5 million, you do not need to put down 20% right away. Instead, you can qualify for an insured mortgage by meeting these minimum requirements:
- 5% down on the portion of the purchase price up to $500,000.
- 10% down on the portion of the purchase price between $500,000 and $1,499,999.
For homes priced at $1,500,000 or more, mortgage default insurance is not available. This means you must provide a minimum 20% down payment, which is known as an uninsured or conventional mortgage. This $1.5 million cap was raised from the previous $1 million limit on December 15, 2024, giving buyers more flexibility in higher-priced markets.
Let’s look at a real-world Ontario scenario. In Brampton, where the average home price hovers around $966,024, many families look for properties in the $950,000 range. If you buy a home for exactly $950,000, your minimum down payment is calculated like this:
- 5% of the first $500,000 = $25,000
- 10% of the remaining $450,000 = $45,000
- Total minimum down payment: $70,000
Here is how the numbers look across different common price points in Ontario:
| Purchase Price | Minimum Down Payment | Type of Mortgage |
|---|---|---|
| $400,000 | $20,000 (5%) | Insured (High-Ratio) |
| $750,000 | $50,000 (5% on $500k + 10% on $250k) | Insured (High-Ratio) |
| $1,000,000 | $75,000 (5% on $500k + 10% on $500k) | Insured (High-Ratio) |
| $1,400,000 | $115,000 (5% on $500k + 10% on $900k) | Insured (High-Ratio) |
| $1,500,000+ | 20% of total price ($300,000+) | Uninsured (Conventional) |
Keep in mind that any down payment below 20% requires mortgage default insurance. In Canada, this insurance is provided by three organizations: CMHC, Sagen, and Canada Guaranty. They all follow the same federal eligibility rules, though their premium rates might vary slightly. This premium is added directly to your mortgage balance, so you do not have to pay it upfront in cash.
Perks for First-Time Buyers and New Builds
When you are trying to break into the market, there are some specific rules designed to make your purchase easier. For starters, first-time home buyers and anyone purchasing a newly constructed home can access a 30-year amortization period on insured mortgages. The standard limit is 25 years, but this 30-year option helps lower your monthly payments. Just be aware that a 30-year insured mortgage comes with a small premium surcharge, which is currently 20 basis points according to Canada Guaranty’s published rates.
There is also tax relief available. Under the First-Time Home Buyers’ GST/HST Rebate, which received Royal Assent on March 12, 2026, eligible buyers can get a full rebate of the federal portion of the tax on new-build homes priced up to $1,000,000. For homes priced between $1,000,000 and $1,500,000, a partial rebate of up to $50,000 is available. This applies to purchase agreements signed on or after March 20, 2025, and before 2031. To qualify, you must meet a four-year look-back rule: neither you nor your spouse can have lived in a home you owned during the current calendar year or the previous four years.
To learn more about buying with less, check out our guide on being a first-time home buyer with no down payment to see how alternative programs work.
Are You an “A” Client or a “B” Client?
Far too often, buyers shop around for the lowest interest rates but ignore the other factors that determine whether they can actually get approved. Your down payment size is closely tied to your overall financial profile. In the lending world, we look at whether you fit into the “A” category or the “B” category.
An “A” client typically has strong credit, stable and provable income, and low debt. If this sounds like you, banks will happily approve you for a high-ratio insured mortgage with the absolute minimum down payment. You can easily find out if you qualify for a 5% down payment under these standard guidelines.
A “B” client might have bruised credit, outstanding collections, or self-employed income that is difficult to prove through traditional tax documents. If you fall into this group, traditional banks might turn you down, and default insurance providers like CMHC may decline to insure your mortgage. In this situation, you will likely need a larger down payment (often 15% to 20%) to secure the property through an alternative lender. Alternative lenders take on more risk, so they require you to have more equity in the home to protect their investment.
But do not lose hope if you have been turned down by a bank. There is almost always a solution, whether that means working with a private lender temporarily or taking steps to clean up your credit so you can qualify for better terms later.
Our Take: What We Actually Tell Our Clients
At Canadian Mortgage Services, we have been working with a network of over 40 lenders since 1988. Here is our honest, opinionated advice: do not stretch yourself so thin to make a down payment that you leave yourself with zero cash on closing day.
Many buyers forget about closing costs. You need to have an extra 1.5% to 4% of the purchase price set aside in cash for land transfer taxes, legal fees, title insurance, and moving expenses. If you put every single penny into your down payment, you might find yourself in a very tight spot when it is time to hand over the keys.
You also need to think about how you will qualify under current interest rate conditions. The Bank of Canada overnight policy rate currently sits at 2.25%. While this rate influences variable mortgage options, all borrowers must still pass the federal stress test. This means you have to prove you can handle payments at a qualifying rate. The stress test requires you to qualify at the greater of your contract interest rate plus 2.0%, or a minimum floor rate of 5.25%.
However, there is some good news if you already have a mortgage. If you want to switch your uninsured mortgage to a different federally regulated lender at renewal time without changing your loan amount or amortization, you no longer have to undergo the stress test. This change makes it much easier to shop around for a better rate when your term is up.
Our article on how much down payment do I need offers additional practical saving tips.
An Extra Option: Insured Refinancing for Secondary Suites
Homeowners who already own a property and want to add value can also take advantage of a unique program. Homeowners can refinance an insured mortgage to build a secondary suite, such as a basement apartment or an in-law suite. Under these rules, the home price limit for this specific refinancing option is $2,000,000. The only catch is that the new additional unit must not be used as a short-term rental. Not all lenders offer this product, so you will need to work with a broker who can match you with a participating institution.
Frequently Asked Questions
What is the absolute minimum down payment in Canada?
The minimum is 5% on the first $500,000 of the purchase price, and 10% on any amount between $500,000 and $1,499,999. If a home costs $1,500,000 or more, you must put down at least 20%.
Can I get a 30-year amortization with a 5% down payment?
Yes, but only if you are a first-time home buyer or if you are purchasing a newly constructed home. Keep in mind that 30-year insured mortgages carry a small premium surcharge (currently 20 basis points) compared to standard 25-year options.
What if a bank turns me down because of my credit?
If a traditional bank rejects your application, you may need a larger down payment of 15% to 20% to work with an alternative or private lender. These lenders look more closely at the value of the property and your equity rather than just your credit score.
How does the mortgage stress test work?
To pass the stress test, you must prove you can afford payments calculated at your contract rate plus 2.0%, or 5.25%, whichever number is higher. This rule applies to most insured and uninsured applications at federally regulated lenders.
Are there portfolio limits on high-income mortgages?
Yes, federally regulated lenders are subject to an OSFI portfolio-level cap on the share of new uninsured mortgages where the loan amount exceeds 4.5 times the borrower’s gross annual income. This is a limit placed on the lender’s overall portfolio, not a hard rule that automatically disqualifies individual buyers, but it is something lenders monitor closely.
Ready to Find Your Best Mortgage Path?
Whether you are planning to buy your very first home in Brampton or want to explore your options with alternative lenders, we can help you figure out the exact numbers. We have built strong relationships with over 40 lenders since 1988 to give you options the big banks cannot match. Give us a call today at 905-455-5005 or visit our contact page to schedule a free, no-obligation consultation.
About the Author: Neil Drepaul in
Neil Drepaul is a Co-Owner and Mortgage Broker at Canadian Mortgage Services. With over 13 years of experience in the Canadian lending industry, Neil brings a strong entrepreneurial spirit to every client interaction. He specializes in helping homeowners and buyers find mortgage solutions that fit their real-life goals, not just their paperwork. His approach is straightforward: serve others first, and success follows.