- Minimum down: 5% of the first $500,000 and 10% of the rest, up to a $1.5 million price.
- First-time buyers can take a 30-year amortization on an insured mortgage (since December 15, 2024).
- You must qualify at the greater of your rate + 2% or 5.25%.
- A pre-approval tells you a budget and may hold a rate; it is not a final approval.
How much down payment does a first-time buyer need?
With less than 20% down your bank will require mortgage default insurance. The minimum down payment is 5% on the first $500,000 and 10% on the portion from $500,000 to $1.5 million; at $1.5 million or more you need 20%. The premium (0.60% to 4.00% of the loan with a traditional down payment) is usually added to the mortgage. Full table: insured mortgages.
| Price | Minimum down | Loan before premium | Loan-to-value | CMHC premium (4.00%) |
|---|---|---|---|---|
| $400,000 | $20,000 | $380,000 | 95.0% | $15,200 |
| $600,000 | $35,000 | $565,000 | 94.2% | $22,600 |
| $900,000 | $65,000 | $835,000 | 92.8% | $33,400 |
Should a first-time buyer choose a 25- or 30-year amortization?
FCAC: with less than 20% down, the maximum amortization is 30 years if you are a first-time buyer and/or buying a new build, and 25 years in all other cases. A longer amortization lowers the payment but costs more interest, and CMHC has announced a 0.20% premium surcharge for first-time buyers choosing 30 years. Compare both in the payment calculator.
What rate will a first-time buyer be stress-tested at?
Every big bank qualifies you at the greater of your contract rate + 2% or 5.25%, with CMHC’s 39% GDS and 44% TDS limits for insured mortgages. Run your numbers in the stress test calculator before you shop.
How should a first-time buyer get pre-approved and choose a lender?
A pre-approval estimates how much you can borrow and may hold a rate for a period. Compare at least one big bank with a broker quote, and look past the rate: prepayment privileges, the penalty method and portability matter if your plans change. All six banks are compared on one page.
How much can a first-time buyer borrow over 25 or 30 years?
A 30-year amortization lowers the payment you have to qualify at, so the same income supports a larger mortgage. The table runs the stress test at National Bank’s 4.69% insured 5-year special (November 2, 2026), qualifying at 6.69%, with $3,600 a year of property tax, $100 a month of heating, no other debts and CMHC’s 39% / 44% limits. The largest mortgage includes the insurance premium, so the price you can pay is lower once your down payment and premium are counted.
| Household income | Largest mortgage, 25 years | Largest mortgage, 30 years | Difference |
|---|---|---|---|
| $75,000 | $299,024 | $319,073 | $20,049 |
| $100,000 | $418,267 | $446,311 | $28,044 |
| $125,000 | $537,510 | $573,549 | $36,039 |
What does your first year of payments actually pay for?
Early payments are mostly interest, and more so on a 30-year amortization. On a $500,000 home with the minimum $25,000 down, the insured loan is $494,000 over 25 years (4.00% premium) or $494,950 over 30 years (with the 0.20% surcharge), at 4.69%:
| 25 years | 30 years | |
|---|---|---|
| Monthly payment | $2,786.58 | $2,550.61 |
| Interest paid in year one | $22,719 | $22,825 |
| Principal repaid in year one | $10,720 | $7,782 |
| Balance after year one | $483,280 | $487,168 |
Which big-bank features matter most for a first home?
First homes are often sold or refinanced within a few years, so the fine print can matter more than a small rate difference:
- Rate holds while you shop: RBC holds a new-mortgage rate for up to 120 days, National Bank’s pre-approval protects the rate for 120 days, and BMO gives Homeowner ReadiLine mortgage portions 130 days.
- Prepayment privileges, from a 10% lump sum a year (RBC, National Bank, BMO Smart Fixed) to 20% (BMO’s other closed mortgages, and some Scotiabank and CIBC options); see products.
- Portability, if you might move up within the term. What each bank says:
| Bank | Portability |
|---|---|
| RBC Royal Bank | Port when buying and selling at the same time; extra money can be blended at the current rate. |
| TD Canada Trust | Port a fixed-rate mortgage (rate, balance, term and amortization) with no prepayment charge, on an approved new application; no window stated. |
| Scotiabank | Listed as a way to avoid charges; not available on every mortgage solution. |
| BMO Bank of Montreal | Port a fixed closed mortgage; extra money blended at the current fixed posted rate. |
| CIBC | All CIBC mortgages except Variable Flex can be ported; the charge may be waived or reimbursed in full or in part, and a delayed port allows up to 120 days. |
| National Bank | Rollover Mortgage: balance, rate and term move to a new National Bank mortgage for your next home, and the prepayment charge is recovered; no window stated. |
What mistakes do first-time buyers make with a big-bank mortgage?
- Treating a pre-approval as a final approval. It estimates a budget and may hold a rate; it isn’t a final approval.
- Shopping at the top of your qualifying limit instead of at a payment you are comfortable with after taxes, heating and maintenance.
- Forgetting that provincial sales tax on the premium, where it applies, is paid at closing and can’t be added to the mortgage.
- Choosing 30 years for a lower payment without comparing the extra interest in the payment calculator.
- Getting only one quote. Compare at least one other bank and a broker on the bank vs broker calculator.
Worked example: a $550,000 first home with the minimum down
Minimum down: $30,000. Loan $520,000 (about 94.5% LTV), premium 4.00% = $20,800. At National Bank’s 4.69% high-ratio 5-year special (November 2, 2026) that’s $3,050.57 a month over 25 years, or $2,792.24 over 30 years with the 0.20% surcharge.
| 25 years | 30 years | |
|---|---|---|
| Down payment | $30,000 | $30,000 |
| Premium | $20,800 | $21,840 |
| Monthly payment | $3,050.57 | $2,792.24 |
Computed by this site’s engine from each bank’s published rates (November 2, 2026) and the rules cited below. An example, not a quote.
What this means for you
- Budget for the premium’s sales tax and closing costs on top of the down payment.
- Run the stress test before you shop, then get pre-approved with a rate hold.
- Pick a bank on prepayment and portability too: first homes are often sold within five years.
Rules change. Every figure on this page links to the official source and shows when we checked it. If something looks out of date, tell us and we will re-check.
Frequently asked questions
Who counts as a first-time buyer for the 30-year amortization?
The federal reforms of December 15, 2024 extended 30-year insured amortizations to all first-time buyers and all buyers of new builds. Lenders and insurers apply the detailed definition; ask your lender how it applies to you.
Can I use gifted money for the down payment?
Lenders commonly accept a gift from immediate family with a signed gift letter, but documentation rules vary by lender and insurer. Ask your bank which documents it needs.
Do I need 20% down to avoid mortgage insurance?
Yes. With less than 20% down your bank will require mortgage default insurance; with 20% or more, no premium applies. Homes priced at $1.5 million or more need at least 20% down and cannot be insured.
Sources
- Saving for a down payment and mortgage loan insurance — FCAC, checked Oct 31, 2026
- Mortgage terms and amortization — FCAC, checked Oct 31, 2026
- Boldest mortgage reforms in decades come into force today — Department of Finance Canada, checked Oct 31, 2026
- CMHC mortgage loan insurance cost — CMHC, checked Oct 31, 2026
- CMHC revises homeowner mortgage loan insurance premiums — CMHC, checked Oct 31, 2026
- CMHC Purchase: homeowner mortgage loan insurance — CMHC, checked Oct 31, 2026
- Preparing to get a mortgage (stress test, GDS/TDS) — FCAC, checked Oct 31, 2026
- Getting pre-approved and qualifying for a mortgage — FCAC, checked Oct 31, 2026
- Mortgage rates — National Bank, checked Nov 2, 2026
- Fixed rate mortgages — RBC Royal Bank, checked Oct 31, 2026
- Homeowner ReadiLine — BMO, checked Oct 31, 2026
- Pay down your mortgage faster (Double-Up, lump sums, skip a payment) — RBC Royal Bank, checked Oct 31, 2026
- Understanding mortgage prepayments and charges — Scotiabank, checked Oct 31, 2026
- Paying off your mortgage faster (prepayment privileges, prepayment charges, portability) — BMO, checked Nov 2, 2026
- Porting a mortgage — RBC Royal Bank, checked Oct 31, 2026
- What you need to know: mortgages and mortgage prepayment charges (PDF) — Scotiabank, checked Oct 31, 2026
- Mortgage prepayment (privileges and prepayment charges) — CIBC, checked Oct 31, 2026
Educational information only, not financial, legal or tax advice. BankMortgages.ca is independent and is not affiliated with, endorsed by or paid by any bank named on this site. Bank terms change: confirm every rate and term with the lender and the official sources linked on each page before you act. Read the full disclaimer.
