Minimum Mortgage Down Payment

Tracy Head • June 30, 2023

Recently I worked with a couple who was selling their home in northern BC and moving to the Okanagan. It had been many years since they applied for a mortgage as they had been in their home for over twenty years.


When we were looking at different options for them we discussed the minimum down payment they

would need. Because of the price difference between the two areas they were concerned they would

not have enough of a down payment to buy a home.


They didn’t realize they could get into a home (under $500,000) with five per cent down. They thought

they would need ten per cent at minimum.


I’ve run into a few people who thought the same thing. Not to age myself, but when the five per cent

down payment option was introduced it was initially available to first-time buyers only. That has changed over time.


What has also changed is the minimum down payment for homes priced over $500,000. The minimum down payment for homes priced over $500,000 is now five per cent of the first $500,000 plus ten per cent of the purchase price over $500,000.


As an example, if you are buying a home priced at $750,000 your minimum down payment will be

$50,000. Five per cent of $500,000 is $25,000. Ten per cent of the purchase price over $500,000 in this

example is another $25,000 (750,000 – 500,000 leaves 250,000 multiplied by ten per cent).

At price points over $1,000,000 this changes again. A minimum of twenty per cent is required. Some

lenders also use a sliding scale to calculate the required down payment for homes priced over

$1,000,000. Some lenders will require a down payment larger than twenty per cent as the price of the

home you are buying increases.


The minimum down payment can apply to a second residence as well. I am seeing more situations

where spouses live or work in different communities and rather than rent they are opting to purchase a second home.


If you have been holding off on a purchase thinking you need ten per cent down payment it will be

worth looking into exactly what you need for a down payment. Speak to a mortgage professional to find out exactly what you need to buy your next home.



Hope you enjoyed the Canada Day weekend!

Tracy Head

Mortgage Broker

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Challenges

By Tracy Head • November 29, 2025
The topics I’ve written about over the years are almost always a reflection of a common theme I’ve seen or challenge I’ve dealt with since the last column I wrote. This one is no different.  The last few months, and particularly the last few weeks, have been among the most challenging in my mortgage career. I say challenging but that might also mean stressful. When working with clients and finding the right fit for their mortgage I look at many different factors. Rate is obviously one of the most important considerations. I also try to get a solid understanding of my clients’ short and longer term goals. For instance if the clients are looking to upsize from a home in the city to a rural property with acreage I will look at chartered banks or credit unions instead of a monoline lender. If the clients are purchasing a lease-hold property there are only a few lenders that will provide financing so that narrows the field. If the clients want direct access to manage their mortgage themselves I will place them with one of my favorite lenders that has an amazing client portal. Sometimes despite the client and the broker doing everything possible to ensure a smooth mortgage process things go sideways. Due to incredibly high volumes over the last few months I’ve seen refinance at renewal mortgages delayed by days or weeks. The stress for everyone involved is overwhelming. The most valuable lesson I’ve learned as a mortgage broker came from a wise more-seasoned broker about ten years ago. She said to me “when things are going sideways on a file, don’t get caught up thinking about what’s going wrong – think about what you need to do to fix it.” I have been hearing these words on repeat the last two weeks, and I think this is helping to keep me (and my clients) on track. If things do appear to be going sideways for you, I encourage you to connect with your mortgage person for regular updates.

Changes Affecting Financing

By Tracy Head • November 14, 2025
I consider myself a lifelong learner, which is part of the reason I love my work. Every day there is something new and exciting to learn, or in some cases re-learn. When I first came back to the mortgage world a more seasoned broker gave me a copy of a handout she used with clients. It talked about the ten most important things NOT to do between removing your financing subject and finalizing the purchase of your home. At the time I remember thinking that the handout sounded patronizing and I assumed clients just understood they shouldn’t do any of the ten things. You know what they say about assuming things. Once or twice my clients have made decisions that have almost jeopardized their financing. The reason this came up for me right now is that I am working my way through a training course which is geared towards helping me re-design my team and my workflow, with the ultimate goal of providing even better support to my clients. One of the changes I am going to implement is adding a list very similar to the original ten things not to do list to my signing packages so that we are all on the same page and avoid any potential challenges down the road. What are the ten things? I won’t go over all of them, but here are a few of the things that have surfaced recently: If you change the closing date on your purchase or if you receive the Notice of Completion on a newly built home, advise your mortgage person right away. Never assume your realtor will do this for you. Do not go out and finance anything without checking with your mortgage person. If you are pushing the upper limit of your buying power even a small loan for furniture might put your financing at risk. Many lenders pull your credit again shortly before your mortgage finalizes. Along the same lines, make sure all of your payments are made on time. Do not co-sign a loan for anyone. Do not quit your job or change employers without talking to your mortgage person ahead of time. Do not spend any of the money you have tucked away for your down payment. If you have money sitting in higher-risk investment better to move them to something more stable in case of market fluctuations. Most people think that once they get the ok to remove their financing subject that their mortgage is a done deal. The small print on every mortgage commitment includes a clause that says something along the lines of “Your financing is based on your current situation. Material changes to your situation prior to the funding of your mortgage may affect your approval.” I’m currently working with a young lady that decided to purchase a boat between the time we had our pre-approval conversation and the day she wrote her offer to purchase. She had decided not to buy a home then found her dream property. We’ve had to look at a few options as the boat payment threw her ratios out of line. She is fortunate that her parents are very supportive and are going to gift her the money to pay off the boat loan, but if she didn’t have that back up plan the new loan would have reduced her borrowing power by over $100,000. The reason I added the comment “without checking with your mortgage person” in the bullets above is that every client’s situation is unique and some of those changes might be just fine. Some might not, and the last thing you want to do is find yourself scrambling to figure out a Plan B shortly before closing.  Best to have the conversation and be certain.