Low Down Payment Options in Brief
- Many buyers can purchase with as little as 5% down.
- Gifted funds from immediate family are often accepted.
- Registered savings, such as an FHSA or RRSP, can help build your down payment.
- Zero-down mortgages are generally not available through insured programs.
Sources Lenders Typically Accept
- Personal savings, usually with 90 days of account history
- First Home Savings Account withdrawals
- RRSP withdrawals under the Home Buyers' Plan
- Gifts from immediate family members, with a signed gift letter
- Proceeds from the sale of another property
- Investments that can be cashed out
Gifted Down Payments
Most lenders accept gifts from parents, grandparents, or siblings. You'll need a gift letter confirming the money is not a loan, and the funds must be deposited in your account before closing.
Borrowed Down Payment Programs
Some lenders offer "flex down" options that allow part of the down payment to come from a personal loan or line of credit. These loans count toward your debt ratios and can make qualifying harder, so they're worth discussing carefully.
Don't Forget Closing Costs
Even with a small down payment, you'll need funds for closing costs. Lenders typically want to see at least 1.5% of the purchase price available for these expenses.
Plan With a Professional
A mortgage professional can review your situation and help you build a realistic plan, whether that means buying now with a smaller down payment or saving a little longer.
