Buying a Home With Only 5% Down?

Buying a Home With Only 5% Down?

Think you need 20% down to buy a home? You might be closer to buying than you think.

In Canada, depending on the purchase price, you can buy a home with as little as 5% down.

How Much Do You Actually Need?

For homes priced at $500,000 or less, the minimum down payment is 5%.

That means:

$400,000 home → $20,000 down
$500,000 home → $25,000 down

Once you go above $500,000, the calculation changes.

For homes between $500,000 and $1.5 million, you'll need:

5% on the first $500,000
10% on the amount above $500,000

So if you're buying a $700,000 home, your minimum down payment would be $45,000 , not $140,000.

For homes priced at $1.5 million or more, a minimum 20% down payment is required.

What If You Put Less Than 20% Down?

When you put less than 20% down, you'll typically need mortgage default insurance.

The insurance protects the lender and allows qualified buyers to purchase without having to save the full 20% down payment.

Your mortgage professional can help you understand how the insurance affects your mortgage and monthly payments.

You May Be Closer Than You Think

If you've been waiting to save 20% because you thought that was the only way to buy, it may be worth finding out what your numbers actually look like.

You don't necessarily need to wait until you have $100,000+ sitting in the bank to start exploring your options.

Buying a home may be closer than you think.

Thinking about buying in Toronto or the GTA? Your next move starts here.