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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I know this is a dumb question but

By Tracy Head • May 19, 2025
I know this is a dumb question but ….  I should probably know this already …. I’m sorry to ask so many questions but …. So many times clients start out with one of these statements. They feel like they should have a better understanding of the mortgage process or terminology. The truth is that buying a home is not a simple journey. Applying for a mortgage is not a cake walk. And even if you’ve been through the process in the past the goal posts seem to move faster than you can keep up. One of the reasons I love (most days) my work is that I am able to spend as much time as I need with my clients helping them understand their financing. When I worked for one of the chartered banks in a previous life I was so tightly scheduled that when our time was up that was it. Someone else had an appointment that I needed to be on time for. Clients have different learning and communication styles. Some come well-versed and understand the mortgage process; others have not done any research and need a lot of hand-holding. My goal is to make sure that by the time they are signing their legal paperwork in front of their lawyer my clients understand the decisions they have made and the rationale behind them. Whether it is the first time you are buying a home or you are looking to refinance your current mortgage it is important that you find a professional to work with that is patient and non-judgmental. In a beautiful world you connect with someone that has bought and sold a few of their own homes and has been working in the mortgage world for a while. It can feel very intimidating to bare your soul to a complete stranger. We often don’t share details of our finances with anyone except our banker / spouse and in some cases I find clients may feel embarrassed about the state of their finances. We see via social media others living lavish lifestyles and somehow feel we should be doing the same. The bottom line is that whether this is your first plunge into the homeownership pool or you are a veteran in the market, it is so important to connect with someone that takes the time to understand your situation and your goals. Knowing your long-term plan and how you handle your finances can help your mortgage professional set you up for success. Please please please make sure you ask all of the questions, even if you think you should know that answers. Guessing that you understand something or bluffing without listening to your mortgage professional’s advice can cause unnecessary grief down the road.

Conditions of Mortgage Financing

By Tracy Head • May 5, 2025
When I work with clients that say they are writing an offer on a private sale I always talk about the benefits of working with a realtor. Realtors do so much legwork that happens behind the scenes that clients aren’t even aware of. Most times it is challenging on my end when clients try to tackle the process of writing an offer on a private sale themselves. I joke and say I am going to charge them an extra fee because of the additional work it creates on our end. I don’t actually charge a fee to be clear but I am only half kidding. When you start down the road of buying a home there are many new and unfamiliar terms you may hear. Whether you are working with a realtor or not, arguably some of the most important things you need to learn about are the “subject to” conditions to include in your offer to purchase. When you write an offer to purchase a home, your realtor will offer guidance as to the conditions you include. Common conditions you will see are:  Subject to arranging suitable financing  Subject to a satisfactory home inspection  Subject to arranging home insurance  Subject to review of strata documents  Subject to the sale of your current home If you are purchasing a rural property or are in a unique situation you may also see:  Subject to a water potability test  Subject to an inspection of the septic system  Subject to the seller finding a suitable home to purchase These lists are not all-encompassing by any means. The purpose of adding conditions to your offer is to protect you in case there are any issues with the home you are looking to purchase. In previous columns I’ve written about the potential dangers of writing a subject-free offer. The high- level, quick position is that if you write a subject-free offer you’d better have cash on hand to buy the home. I have worked with several clients over the last few months that have written private offers. We do absolutely everything ahead of time to try to ensure they will be successful with their financing. These files stress clients more than you can imagine. They have to either find templates to fill out or pay a lawyer or notary to prepare the documents for them. Either way they need to quickly learn about the conditions I listed above and understand key dates involved in the buying process. The clients need to deal directly with the sellers on any issues that may arise. When you are working with a realtor they handle these issues on your behalf. A knowledgeable realtor also helps avoid issues by taking any of the personal contact and emotions out of any potential areas of conflict. Make sure you do your due diligence and have your ducks in a row as you move forward with an offer to purchase whether writing an offer with a realtor or on your own. Now that the sun has come out and the election is over I’ve seen my clients more actively shopping which is encouraging. As always, my advice is to work with a realtor that you are comfortable with and who knows your area well.