In December 2024, the federal government updated the minimum down payment thresholds for the first time in years. The upper limit for insured mortgages rose from $1,000,000 to $1,500,000 — a significant change for buyers in Vancouver, Toronto, and other high-cost markets. Here's the complete picture of what's required and why.
The current down payment rules (effective December 15, 2024)
| Purchase price | Minimum down payment | Example |
|---|---|---|
| Under $500,000 | 5% | $400,000 home → $20,000 minimum |
| $500,000–$1,499,999 | 5% on first $500K + 10% on remainder | $800,000 home → $55,000 minimum |
| $1,500,000 and over | 20% minimum (no CMHC available) | $1.6M home → $320,000 minimum |
How the sliding scale works for mid-range homes
The sliding scale between $500,000 and $1,499,999 is where many buyers get confused. Here's how to calculate it:
- Take 5% of the first $500,000 = $25,000
- Take 10% of the amount above $500,000
- Add them together
For a $900,000 home: 5% × $500,000 = $25,000, plus 10% × $400,000 = $40,000. Total minimum down payment: $65,000 (7.2% effective rate).
For a $1,400,000 home: 5% × $500,000 = $25,000, plus 10% × $900,000 = $90,000. Total: $115,000 (8.2% effective rate).
Where your down payment can come from
For an insured mortgage (down payment under 20%), the lender and CMHC have specific rules about acceptable down payment sources:
- Personal savings: Your own funds, documented with 90 days of bank statements showing the accumulation of savings over time
- FHSA withdrawal: Tax-free and no repayment required (see our FHSA guide for details)
- RRSP Home Buyers' Plan: Up to $60,000 per borrower, repayable over 15 years
- Gifts from immediate family: Requires a signed gift letter; the money must be verifiably a gift, not a loan
- Sale of another asset: Documented proceeds from the sale of a vehicle, investments, or other property
- Proceeds from a previous home sale: Acceptable with the completed sale documentation
What is not acceptable as a down payment for insured mortgages: borrowed funds (loans, credit card advances, lines of credit), cash with no documentation trail, or gifts from non-immediate-family members.
The 90-day paper trail requirement
Lenders will request 90 days of bank statements and will scrutinise every large deposit during that window. The purpose is to verify that the funds are genuine savings or documented gifts — not undisclosed borrowed funds. If you move money between accounts, consolidate savings, or receive large deposits in the 90 days before applying, each one requires documentation and explanation. This is explored in more detail in our 90-day bank rule guide.
The 20% threshold — and why it matters
Reaching 20% down is the threshold at which CMHC mortgage default insurance is no longer required. The practical effects: your mortgage balance is lower (no premium added), you pay less interest over time, and you access conventional mortgage products with slightly different terms. Whether saving to 20% is the right strategy depends on your market, timeline, and opportunity cost — the Turning Keys program covers this calculation in detail.
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Disclaimer: This article is educational content only — not financial, mortgage, legal, or real estate advice. Rules and figures are current as of 2024–25 and may change. Always consult a licensed professional for advice specific to your situation. Turning Keys is operated by Wise Victoria Mortgages (BCFSA Lic. #MB600614) and Nick Wise Personal Real Estate Corporation.