What is the minimum down payment in Canada in 2026?

5 percent on the first $500,000 of purchase price, 10 percent on the portion between $500,000 and $1.5 million, and 20 percent on the portion above $1.5 million.

When is mortgage default insurance required?

Whenever the down payment is less than 20 percent of the purchase price, on homes priced up to $1.5 million. Homes over $1.5 million cannot be insured and must have at least 20 percent down.

Is 20 percent down always better than 5 percent?

Not always. 20 percent avoids the insurance premium and allows 30-year amortizations for any borrower, but insured mortgages often have lower contract rates and let buyers enter the market sooner.

What changed for the insured mortgage cap in late 2024?

Effective December 15, 2024, the federal cap rose from $1 million to $1.5 million, allowing default insurance on homes priced up to $1.5 million.

Can the down payment come from a gift?

Yes. Lenders require a signed gift letter from an immediate family member confirming the funds are non-repayable, plus 90 days of bank statements showing the funds in the buyer's account before closing.

Can I put less than 5 percent down with a co-signer?

No. The 5 percent minimum is set by federal regulation and cannot be reduced by adding co-signers.

Are closing costs in addition to the down payment?

Yes. Lenders typically verify that closing costs (1.5 to 4 percent of purchase price) are available beyond the down payment.

5% vs 10% vs 20% Down Payment in Canada: What Each Means

Canadian minimum down payment is 5 percent on the first $500,000 of purchase price, 10 percent on the portion between $500,000 and $1.5M, and 20 percent above $1.5M. Reaching 20 percent eliminates default insurance and opens longer amortizations. This guide compares costs at 5/10/15/20 percent on a $700,000 home and explains why each level might be the right call.

Reviewed by Canadian Money Help Editorial Updated May 7, 2026 Source CMHC / CRA 2026

Quick answer: In Canada, the minimum down payment is 5% on the first $500,000 of purchase price, 10% on the $500,000-$1,500,000 portion, and 20% on properties over $1.5 million (uninsured only). Below 20% triggers CMHC mortgage insurance.

What this means: A $700K home needs at least $45,000 down ($25K on the first $500K + $20K on the next $200K). The CMHC insurance premium (0.6%-4.0% of mortgage) is added to the principal — you pay interest on it for the full amortization.

What to do next: See your maximum purchase price for any down payment amount. Run the affordability calculator →

The minimum down payment in Canada depends on the purchase price. Homes priced up to $500,000 require 5 percent down. Homes priced between $500,000 and $1,500,000 require 5 percent on the first $500,000 and 10 percent on the portion above. Homes priced over $1,500,000 require 20 percent down because mortgage default insurance is not available above that price. Reaching 20 percent down avoids the CMHC, Sagen, or Canada Guaranty insurance premium and gives access to longer amortizations and more lender flexibility.

Minimum down payment by purchase price

Purchase price	Minimum down payment	Worked example
Up to $500,000	5%	$400,000 home → $20,000 down
$500,001 to $1,500,000	5% on first $500,000 + 10% on remainder	$800,000 home → $25,000 + $30,000 = $55,000 down
Over $1,500,000	20% (uninsured only)	$1,800,000 home → $360,000 down

Effective December 15, 2024, the federal insured mortgage cap rose from $1 million to $1.5 million. Homes between $1 million and $1.5 million can now qualify for default insurance with as little as 5 percent + 10 percent down.

Cost comparison: $700,000 home

Down payment	Down payment $	Mortgage size	CMHC premium	Total to close (excl. closing costs)
5% (minimum)	$25,000 + $20,000 = $45,000	$655,000	4.00% × $655,000 = $26,200	$45,000 down + $26,200 insurance financed into mortgage
10%	$70,000	$630,000	3.10% × $630,000 = $19,530	$70,000 down + $19,530 financed
15%	$105,000	$595,000	2.80% × $595,000 = $16,660	$105,000 down + $16,660 financed
20%	$140,000	$560,000	None (uninsured)	$140,000 down + $0 insurance

Why 20 percent matters

No mortgage default insurance premium. The premium is added to the mortgage and amortized over the life of the loan, raising the total cost.
Longer amortization is available. Insured mortgages are limited to 25 years, with 30 years allowed only for first-time buyers and new builds. Uninsured mortgages can go to 30 years for any borrower at most lenders.
More lender choice. Some monoline lenders specialize in insured business; some big banks specialize in uninsured. At 20 percent down you can shop both pools.
Lower payment. A smaller mortgage means a smaller monthly payment regardless of rate.

Why putting less than 20 percent can be the right call

Reason	Detail
Speed of entry	Five percent gets you into a $500,000 home with $25,000. Saving for 20 percent ($100,000) can take many years; the home price may rise faster than the savings.
Lower interest rate (counterintuitive)	Insured (high-ratio) mortgages often carry the lowest contract rates because lenders bear no default risk. The headline rate can be 0.10 to 0.30 percentage points lower than uninsured.
Keep emergency fund	Stretching for 20 percent can drain savings; lenders verify that you have enough left over for closing costs and a buffer.
Use FHSA + HBP capacity	The combined FHSA + HBP path lets first-time buyers access up to $100,000 of registered savings, a strong path to the 5-10% threshold.

What lenders actually require beyond the minimum

Source of funds: 90-day bank statements showing the down payment is yours. Gifts must be documented with a gift letter.
Closing costs: typically 1.5 to 4 percent of the purchase price (legal fees, land transfer tax, title insurance, appraisal). Lenders verify you have these in addition to the down payment.
Stress test: regardless of down payment, you must qualify at the higher of the contract rate plus 2 percent or the 5.25 percent benchmark.
GDS/TDS limits: gross debt service ratio under 39 percent and total debt service under 44 percent for most insured lenders.

Provincial twists

Province	Notable item
Ontario	Land transfer tax doubles in Toronto; first-time buyers receive a partial rebate up to $4,000 (provincial) plus $4,475 in Toronto.
British Columbia	Property Transfer Tax with first-time buyer exemption up to $835,000 (purchase price); 2% additional foreign buyer tax if applicable.
Alberta	No land transfer tax, but registration fees apply on title and mortgage.
Quebec	Welcome tax (taxe de bienvenue) due as a lump sum within 30 days of registration.

Cross-references

Frequently asked questions

What is the minimum down payment in Canada in 2026?: 5 percent on the first $500,000 of purchase price, 10 percent on the portion between $500,000 and $1.5 million, and 20 percent on the portion above $1.5 million.
When is mortgage default insurance required?: Whenever the down payment is less than 20 percent of the purchase price, on homes priced up to $1.5 million. Homes over $1.5 million cannot be insured and must have at least 20 percent down.
Is 20 percent down always better than 5 percent?: Not always. 20 percent avoids the insurance premium and allows 30-year amortizations for any borrower, but insured mortgages often have lower contract rates and let buyers enter the market sooner.
What changed for the insured mortgage cap in late 2024?: Effective December 15, 2024, the federal cap rose from $1 million to $1.5 million, allowing default insurance on homes priced up to $1.5 million.
Can the down payment come from a gift?: Yes. Lenders require a signed gift letter from an immediate family member confirming the funds are non-repayable, plus 90 days of bank statements showing the funds in the buyer's account before closing.
Can I put less than 5 percent down with a co-signer?: No. The 5 percent minimum is set by federal regulation and cannot be reduced by adding co-signers.
Are closing costs in addition to the down payment?: Yes. Lenders typically verify that closing costs (1.5 to 4 percent of purchase price) are available beyond the down payment.