Key takeaways
- Minimum down payment: 5% up to $500,000, 10% on the part from $500,000 to $1.5 million, 20% at $1.5 million or more
- With less than 20% down, you need mortgage insurance, which usually adds 2.80% to 4.00% of the loan
- You must qualify at the higher of 5.25% or your rate plus 2% (the stress test)
- CMHC can accept a foreign credit report or a bank letter from home if you have no Canadian credit
- Work permit holders face the foreign buyer ban until January 1, 2027, unless an exception applies
Can a newcomer get a mortgage in Canada?
Yes. CMHC, the federal housing agency that insures mortgages, says there is no minimum period of residency for its newcomer rules. Permanent residents and people legally allowed to work in Canada can apply.
Big banks have newcomer mortgage programs too. As of October 10, 2026:
- RBC says permanent residents in Canada less than 5 years, and temporary residents, may qualify. It accepts “no or thin Canadian credit history” if there is no bad credit information.
- BMO says permanent residents who immigrated in the past 5 years, or people with a valid work permit, may qualify with limited or no Canadian credit history.
Each lender still checks your income, debts and down payment. A program does not guarantee approval.
How much down payment do you need?
| Purchase price | Minimum down payment | Example |
|---|---|---|
| $500,000 or less | 5% | $400,000 home: $20,000 |
| $500,000 to $1.5 million | 5% of the first $500,000 plus 10% of the rest | $600,000 home: $25,000 + $10,000 = $35,000 |
| $1.5 million or more | 20% | $1.6 million home: $320,000 |
Source: FCAC and Finance Canada, rules in effect since December 15, 2024.
Where the money can come from
CMHC accepts savings, money from selling a property, and a non-repayable gift from a relative. Money from abroad is fine, but expect to show where it came from. RBC says it may ask for extra documents for down payment funds from another country. Read gift letters and down payments from family abroad.
CMHC also allows a borrowed down payment in some cases, but not for non-permanent residents.
What is mortgage insurance and what does it cost?
If you put down less than 20%, you need mortgage default insurance. It protects the lender, not you. Insured mortgages are only for homes priced under $1.5 million. The premium is a percentage of the loan and is usually added to the mortgage.
| Loan as % of price | CMHC premium |
|---|---|
| Up to 65% | 0.60% |
| 65.01% to 75% | 1.70% |
| 75.01% to 80% | 2.40% |
| 80.01% to 85% | 2.80% |
| 85.01% to 90% | 3.10% |
| 90.01% to 95% | 4.00% |
Source: CMHC, checked October 10, 2026. In Ontario, Quebec and Saskatchewan, provincial sales tax applies to the premium and cannot be added to the loan. You pay it at closing. Estimate it with the mortgage insurance tax calculator.
Sources differ. The FCAC down payment page still says insurance is not available at $1 million or more (checked October 10, 2026). Finance Canada raised the limit to $1.5 million from December 15, 2024, and CMHC’s current rules use under $1.5 million.
What is the mortgage stress test?
Lenders check that you could still pay if rates went up. You must qualify at the higher of 5.25% or your contract rate plus 2%. OSFI, the federal bank regulator, sets this for uninsured mortgages, and CMHC uses the same rate for insured ones. OSFI reviews this rate at least once a year.
CMHC also limits two ratios, calculated at that qualifying rate:
- GDS (gross debt service): housing costs, such as payment, property tax and heating, can be at most 39% of gross income.
- TDS (total debt service): housing costs plus other debts, such as car loans and card payments, can be at most 44%.
Amortization (the total time to pay off the loan) is up to 25 years for insured mortgages. First-time buyers and buyers of newly built homes can get 30 years on an insured mortgage. CMHC adds 0.20% to the premium for a 30-year amortization.
Worked example: a $600,000 home
Assume a first-time buyer, a $600,000 home and the minimum down payment. The 4.5% rate is only an example, not a quote.
| Step | Amount |
|---|---|
| Minimum down payment | $35,000 |
| Loan before insurance | $565,000 (94.2% of the price) |
| CMHC premium at 4.00% | $22,600 |
| Total mortgage | $587,600 |
| Monthly payment at 4.5%, 25 years | about $3,252 |
| Qualifying payment at 6.5% (4.5% + 2%) | about $3,936 |
If property tax and heating add $500 a month, the lender uses about $4,436 in housing costs. At a 39% GDS limit, that needs a gross household income of about $136,500 a year, before other debts are counted. With 30 years, the premium rises to 4.20% ($23,730, for a $588,730 mortgage), and the qualifying payment drops to about $3,688. Payments assume semi-annual compounding, as is normal for Canadian fixed-rate mortgages.
Try your own numbers with the mortgage affordability calculator and add costs with the closing costs calculator.
What if you have no Canadian credit history?
CMHC needs a minimum credit score of 600 for at least one borrower or guarantor. If your Canadian history is thin, CMHC says lenders may consider:
- a credit report from your home country, or
- a reference letter from your bank at home.
BMO lists landlord letters and records of payments to Canadian service providers as possible documents. Start building Canadian credit early with a card you pay in full: see how to build credit fast.
Work permit holders and the foreign buyer ban
The Prohibition on the Purchase of Residential Property by Non-Canadians Act stops most non-Canadians from buying homes in Canada until January 1, 2027. Permanent residents are not affected.
Work permit holders can buy if they meet all of these:
- a valid work permit or work authorization,
- at least 183 days left on it on the purchase date,
- have not already bought a home in Canada while the ban applies.
Students have a narrower exception, which includes 5 years of tax filing and a price limit of $500,000. Refugees and protected persons are exempt. Breaking the law can mean a fine of up to $10,000 and a forced sale. Check whether the ban was extended again before you buy.
Some provinces also charge extra taxes to some buyers who are not citizens or permanent residents. Check the rules in your province before you make an offer.
Next steps before you shop for a home
- Save in an FHSA. A First Home Savings Account gives a tax deduction now and tax-free use for a first home. See FHSA for newcomers.
- Get pre-approved. A pre-approval holds a rate for a set time. RBC guarantees its rate for up to 120 days; BMO advertises a 130-day rate hold, as of October 10, 2026.
- Gather documents: ID and status, proof of income, down payment statements (including from abroad), and any foreign credit report.
- Compare lenders. Banks, credit unions and mortgage brokers all offer mortgages.
How we handle offers. Product details on this page come from each provider’s own website and were last checked on October 10, 2026. Providers change features and rates often, so confirm the details on their site before you apply. No provider pays to be included or ranked here. If a link on this page ever earns us a commission, we will label it next to the link.
Common questions
How long do I need to live in Canada to get a mortgage?
Can I buy a house in Canada on a work permit?
What is the minimum down payment in Canada?
Can I use money from my home country for the down payment?
What is the stress test rate in 2026?
Sources
- FCAC: Down payment
- Finance Canada: Mortgage reforms (effective December 15, 2024)
- OSFI: Minimum qualifying rate for uninsured mortgages
- CMHC: Mortgage loan insurance cost
- CMHC: CMHC revises homeowner mortgage loan insurance premiums (30-year surcharge)
- CMHC: Mortgage financing options for new residents
- CMHC: Purchase mortgage loan insurance
- CMHC: Prohibition on the Purchase of Residential Property by Non-Canadians Act
- RBC: Mortgages for newcomers to Canada
- BMO: Mortgages for new Canadians