What you need for your minimum down payment is a very common question in today’s market so let’s break that down. The minimum down payment requirements are: 5% on the first $500,000. 10% on the next $500,000, up to $1,000,000. 20% on any purchase over $1,000,000. 20% will also be required when you: Purchase a rental property Take a 30-year amortization Refinance your mortgage Purchase over $1,000,000 Utilize alternative financing options Examples of some down payment sources may include: Personal savings A gift from an immediate family member RRSP’s or TFSA’s Investment accounts Borrowed money in some cases

Let’s break down a few common sources of down payment. Savings – This strategy often takes the longest to accumulate. Gift – When buying an owner occupied home, you can secure financing with a gift from an immediate family member RRSP’s / TFSA’s – These tax-sheltered accounts are among some of the most popular accounts used as down payment sources today. Investment Accounts – Like RRSP’s & TFSA’s, additional investment accounts are great options to utilize for your next down payment. HELOC – A home equity line of credit is a common source that many homeowners utilize to invest in real estate. In this case,…

A purchase deposit demonstrates the buyer’s good faith to the seller to close on their purchase. This deposit is held in trust & then credited back to the buyer at completion as part of their total down payment. For example, if your total down payment is $25,000 & your deposit is $10,000, you will only owe the difference of $15,000 at time of completion. Alternatively, if your down payment is $25,000 & you agree to a $30,000 deposit, you will be reimbursed the $5,000 at completion. Typically, the deposit is 5%, sometimes 10% of the purchase price. Is this deposit due right away?…

This type of financing comes into play when you have purchased a home, but your deposit is tied up in the sale of your current home. A deposit is different from a down payment and demonstrates the buyer’s good faith to close on their purchase agreement. If you find yourself needing these temporary funds, there are options available. How it Works: • A firm sale contract for your current home must be provided. • The funds leant are secured against your current home. • The amount borrowed for your deposit on your new home must be paid back in full once the sale of your current home completes. Keep…

No Subject to qualifying, anyone can qualify at 5% down Property must be an owner occupied or a 2nd home

Let’s take a $500,000 home with the minimum 5% down ($25,000) After subtracting loan insurance of $19,000, your home will appreciate a very modest $52,000 & have a balance of $414,000 at the end of your term. That’s a total of $139,000 in YOUR POCKET after only 5 years! Know your options – Remember, its time in the market that builds wealth in real estate!

This rule was implemented as the new anti-money laundering act in 2018 It implies that all banks will require proof of down payment via a 90-day bank statement history on any purchase. This means all transactions will be reviewed and a paper trail of your down payment will be required.

Not necessarily With as little as 5% down, you will see the best available rate, but you will be required to pay mortgage loan insurance at 2.5% - 4% With 20% down, your rate will be slightly higher with no insurance required

A conventional mortgage refers to any mortgage with a maximum loan-to-value of 80%. In other words, a conventional mortgage refers to any mortgage with a down payment equal to or greater than 20% of the purchase price and does not require mortgage loan insurance.

Insured Refers to when your down payment is less than 20%. The property purchase price must be less than $1,000,000. Must qualify at a 25-year amortization. Owner occupied or 2nd home purchases only. Can’t be a rental property. Important to note on all insured mortgages with less than 20%, mortgage loan insurance is required. Because your mortgage loan insurance premium is protecting the lender, you will qualify for the markets lowest interest rate. Insurable Your down payment will be greater than 20%. The property purchase price must be less than $1,000,000. Can’t be a rental property. What makes an Insured mortgage different than an insurable mortgage is that you are now putting…

Mortgage loan insurance, also known as mortgage default insurance, is an insurance premium paid by the borrower, to in which protects the lender for in the event that the borrower defaults on their mortgage obligations. Mortgage loan insurance is provided by one of three institutes, CMHC, Canada Guaranty, or Sagen. Mortgage loan insurance is implemented on any mortgage that has a down payment of less than 20% of the purchase price of a home. The insurance premiums range from 0.50% to 7.0% and can be added directly onto the mortgage amount.

The main advantage to your home equity line of credit is ongoing access you have to your equity at a low cost of borrowing. Rates are typically set at prime to prime or prime + 0.50% Because your home equity is secured against your largest asset - your home, you will be able to borrow significantly more than a standard line of credit would allow. You can access your home equity line of credit for the purpose of additional investments such as purchasing a rental property. The monthly interest that you are charge when advancing funds from your HELOC for the purpose of any…