Calculate the initial amount you’ll put down when the loan is granted.
Why make a downpayment?
The downpayment reduces the loan amount and the interest paid in your payments.
Before deciding on the downpayment, you should assess your needs and budget. Are you planning any purchases in the near future? Do you have savings to meet any unforeseen expenses?
How much will you put down?
You can put down at least 20% of the purchase price
If your downpayment amounts to 20% or more of the purchase price of your home, you may be eligible for a conventional loan (uninsured), and could save on mortgage insurance costs.
20% of the purchase price is beyond your budget
In cases where mortgage financing represents more than 80% of the value of the property, banks are required by law to obtain mortgage loan insurance coverage from the Canada Mortgage and Housing Corporation (CMHC) or Genworth Financial Canada. In such cases, a mortgage loan insurance premium would be charged to you1. The smaller the downpayment, the higher premium rate.
Where can I find the money for my downpayment?
The downpayment could come from your cash savings, investments, a gift, an inheritance or even your RRSPs.
Home Buyers’ Plan2 (HBP)
The HBP is a federal government program designed to make the purchase of a home more accessible to the average household. If you have registered investments (RRSP), you could take advantage of the Home Buyers’ Plan and withdraw up to $25,000 from your RRSP to use as a downpayment.
||Withdrawal is not taxable.
||You must start repaying your RRSP in the second year following the withdrawal.
||You have 15 years to repay what you withdrew.
Home Buyers’ Plan and the RRSP loan
Don’t have $25,000 in your RRSP but still want to make benefit from of the Home Buyers’ Plan?
Ask your advisor how an RRSP loan3 could help you.
Did you know that it is now possible to make a down payment on a home using National Bank's Internet Banking Solutions and Mobile Banking Solutions?
Assyst Payment, a Telus solution offered in cooperation with the Chambre des notaires du Québec, enables you to deposit your down payment directly to your notary's in-trust account using a Coupon for Funds Transfer that your notary will give you or send to you by e-mail or fax.
Follow the steps below to make a down payment using our Internet Banking Solutions or Mobile Banking Solutions:
||Open a session and select Add to add a bill.
||In the list of suppliers, look for Assyst Payment and add it as a supplier by using the unique reference number indicated on the Coupon for Funds Transfer you received from your notary.
||Confirm the addition and select Bill payment.
||Enter the amount of the down payment and confirm the payment.
Please allow three business days for the funds to be transferred to the notary's in-trust account.