Home Purchase Mortgage Toronto ON
Toronto Mortgage Broker with 10+ years of experience
Arranging financing that suit the clients needs once they have an accepted offer on a residential property.
Whether you’re a first-time homebuyer, or looking to buy a second home or investment property, you more than likely will need to obtain a mortgage.
If you’re purchasing a principal residence, you can do so with as little as 5% down, assuming the purchase price is $500,000 or less.
If you’re purchasing for more than $500,000 but less than $1mil your minimum down payment is based on a sliding scale.
If the home you’re looking to buy is going to cost $1million or more, the standard minimum down payment is 20%, but is again subject to a sliding scale.
Similarly, investment properties also require a minimum of 20% down.
You’re probably wondering what a sliding scale is.
The sliding scale helps determine the minimum down payment, based on the purchase price. You’ll notice that as a property price increases, so does the minimum down payment.
As mentioned above, if you purchase a property for $500,000 or less, the minimum down payment is 5%. When the purchase price exceeds $500,000, the minimum down payment is 5% for the first $500K, and 10% for the remaining portion.
If your purchase price is $1,000,000 or more, the minimum down payment is typically 20% of the purchase price up to $1,200,000 – and an additional 50% of any amount over. This sliding scale can some times vary between lenders.
Example:
You’ve just bought an owner-occupied property for $750,000
Your minimum down payment would be:
5% of the first $500,000 = $25,000
10% of the balance ($250K) = $25,000
Therefore, the minimum down payment under this scenario would be $50,000