Options for your Down Payment

Savings or Short Term Investments
If you've saved for your down payment, you may need to show three or more months of banking history, and explain any large deposits during this time period. Copies of statements for other investments and savings accounts may also be required.

Monetary Gift
If you have been gifted your down payment, you may have to provide a letter stating that the gift given is from an immediate relative (parent or sibling) and that the gift is not repayable.  You also need to confirm that the funds are in your possession at least 15 days prior to closing.

Sale of your current home
When your down payment comes from a property sale, you must provide a firm offer to purchase, along with a mortgage statement showing the balance owing.

RRSP First Time Home Buyer's Plan
You can use your RRSP savings as a down payment. The Home Buyers Plan (FTHB) is a government program that allows first-time homebuyers to borrow up to $35,000 from your registered retirement savings plans (RRSP's) to buy or build a principal home. The money you withdraw is not subject to tax but must be paid back to the RRSP account over a 15-year period. * Minimum annual repayments are required. Visit the Canada Revenue Agency’s website for more detailed information, including a detailed guide and the required forms.

You can borrow your down payment (e.g., personal loans, lines of credit, lender cash-back incentives), although there are typically increased insurance premiums or fees and higher credit criteria and potentially higher interest rates.

Source: Sharlene Scott, Mortgage Advisor with Mortgageline Mortgage Architects
The above information is provided as general information and is not considered legal advice. Please consult your lawyer if you have any questions or concerns about this information.

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