Short answer: Newcomers need the same minimum down payment as anyone in Canada: 5% on the first $500,000 and 10% on the portion up to $1,500,000. You don’t automatically need 20%. What matters most is tracing: lenders want to see where the money came from, when it arrived in Canada and how it moved, usually through 90 days of statements from both the sending and receiving accounts. The funds must be in a Canadian account before closing.
Minimum Down Payment in Canada
- 5% for homes up to $500,000
- 5% on the first $500,000 plus 10% on the rest, from $500,000 to $1,500,000
- 20% for homes at $1,500,000 or more
These are the minimums. Lender and insurer rules decide which newcomer profiles qualify with the minimum.
Do Newcomers Need 20% Down?
No. Some newcomers qualify with the minimum when income, documents and the overall file are strong. A larger down payment helps when your Canadian credit is thin, your Canadian job is new, your status narrows lender options, or your funds arrived recently. But 20% down with unclear sourcing can still cause problems.
→ Related: How to Build Canadian Credit Faster
Accepted Down Payment Sources
- Personal savings: bank statements showing the history
- Gifts: a gift letter and proof of deposit from immediate family
- International transfers: statements and transfer confirmations from both sides
- Sale of an asset: paperwork for the sale and the deposit
What Is Down Payment Tracing?
The lender verifies where the funds originated, when they entered Canada, which accounts held them and how they moved between accounts.
Mistakes That Cause Delays
- Cash deposits with no paperwork
- Moving money through several accounts without statements for each
- International transfers without proof from the sending account
- Gifts without a gift letter
- Changing accounts right before the lender reviews your file
Plan for Closing Costs Too
Legal fees, an inspection, moving, property tax and utility adjustments, and a reserve for early ownership costs. Budget about 1.5% of the price. Try our closing cost calculator and affordability calculator.
How We Help
We review your down payment source and transfer history before you make an offer, tell you exactly which documents prove each source, and line it up with your overall mortgage plan. See our New to Canada mortgage program or book a free call.
Frequently asked questions
What is the minimum down payment for newcomers in Alberta?
5% on the first $500,000 and 10% on the rest up to $1,500,000. Some lenders ask for more depending on residency status and credit history.
Do newcomers need 20% down to buy a home in Canada?
No. Many newcomers qualify with less than 20% down through insured programs. A larger down payment widens lender options but isn't always required.
Can newcomers use gift funds for a down payment?
Yes, from immediate family, with a signed gift letter and proof of the transfer.
Can I use savings from my home country?
Yes, if you can document where the money came from and trace the transfer into your Canadian account, usually with statements from both the sending and receiving accounts.
Can I borrow my down payment?
Generally not for insured mortgages. Lenders want funds from savings, gifts or the sale of an asset.
This article is general information, not personal financial advice. Rates, rules and programs change. Talk to a licensed mortgage broker about your situation. Lacroix Mortgage Group is licensed through Mortgage Connection Inc.