Changes to down payment requirments2015-12-11 12:15:16 Posted By Jila Rezai
Today Finance Minister Bill Morneau announced changes to down payment requirements. Effective February 15, 2016, the minimum down payment for new insured mortgages will increase from five per cent to 10 per cent for the portion of the house price above $500,000. The five per cent minimum down payment for properties up to $500,000 remains unchanged.
For example, once the new rules come into effect, the minimum down payment required to purchase a $800,000 home will be $55,000 which is calculated as 5% of $500,000 ($25,000) plus 10% of $300,000 ($30,000).
All of our clients who have real deals closing in the next couple of months will not be impacted by this change. Clients who have pre-approvals are only impacted if they are high-ratio (i.e. having a down payment of less than 20% of the purchase price) and they are hoping to purchase a home above $500,000.
If you have any questions or concerns about this, please give me a call at 604-773-3599. As always, I am here to help!
Click here for the government's official news release.