• Newcomers

Mortgage Down Payment Information for Newcomers

Mortgage Down Payment Information for Newcomers

When it comes to buying a home, most Canadians don’t pay for the full cost of their home all at once. Generally, the money to finance the purchase of a new home comes from two sources:

  • Down payment — the initial payment from your personal savings
  • Mortgage — the remainder of the money, borrowed from a lender such as a bank, which you’ll need to pay back in regular payments over a set period of time

For buying a home in Canada, you need to make a down payment of at least 5%53 of the purchase price. Although, it’s in your best interest to make as large a down payment as much as possible as it will help you lower your regular mortgage payments and potentially save you from paying additional costs such as mortgage insurance.

Generally, if you have a down payment that is equal to or more than 20% of the purchase price, you may qualify for a “conventional” mortgage. The benefit of a conventional mortgage is that you don’t need to purchase mortgage insurance. If you don’t have 20% to put down, you may qualify for a mortgage but it will need to be insured against default.

For newcomers who are just starting out and do not have an employment history in Canada, we have special programs with a down payment of 35% or more.

Saving for a down payment isn’t always easy, and everyone’s mortgage needs are different. Fortunately there is a wide range of mortgage options to suit your budget, circumstances and goals.

You can take advantage of either the RBC automatic savings plan or available tax-efficient solutions such as:

  • Tax-Free Savings Account (TFSA) – where you won’t pay tax on any income earned and you’ll have the flexibility to withdraw it at any time
  • Tax-deductible Registered Retirement Savings Plan (RRSP) – which you can use to take advantage of the Home Buyer’s Plan

Whether you or your family has existing savings from your home country or you are just starting out, we have experts at RBC who can help make home-buying a seamless process for you. For more information and advice, contact a mortgage specialist at

Speak to an RBC Mortgage Specialist today