Buying your first home is one of the most exciting—and overwhelming—financial decisions you'll ever make. This guide walks you through every step, from understanding your budget to getting the keys, giving you the confidence to navigate the Canadian housing market.
Getting Started: Know Your Budget
Before browsing listings, understand what you can actually afford. The general rule: your monthly housing costs shouldn't exceed 32% of your gross monthly income. This includes:
- Mortgage principal and interest
- Property taxes
- Heating costs
- Condo fees (if applicable)
Pro tip: Use our mortgage calculator to see what payments look like at different price points.
Down Payment Requirements in Canada
In Canada, minimum down payments are based on purchase price:
| Purchase Price | Minimum Down Payment |
|---|---|
| Up to $500,000 | 5% |
| $500,000 – $999,999 | 5% of first $500K + 10% of remainder |
| $1 million+ | 20% |
If your down payment is less than 20%, you'll need CMHC mortgage insurance—an added cost, but it allows you to buy sooner.
Getting Pre-Approved
A mortgage pre-approval is essential. It tells you exactly what you can borrow and shows sellers you're serious. During pre-approval, lenders review:
- Credit score and history
- Income and employment stability
- Existing debts
- Down payment savings
Pre-approvals typically lock in a rate for 90-120 days, protecting you from rate increases while you shop.
Ready to Take Action?
Getting pre-approved is the single most important step you can take right now. Start your application to see exactly what you qualify for—it only takes a few minutes.
Why Work with a Mortgage Broker?
Unlike banks that only offer their own products, mortgage brokers:
- Compare rates from 50+ lenders
- Find products suited to your situation
- Handle the paperwork for you
- Cost you nothing (lenders pay broker fees)
Learn more about the advantages of working with a broker.
Closing Costs: Budget for the Extras
Don't forget closing costs—typically 1.5% to 4% of the purchase price:
| Cost | Typical Amount |
|---|---|
| Land transfer tax | Varies by province |
| Legal fees | $1,500 – $2,500 |
| Home inspection | $400 – $600 |
| Title insurance | $300 – $500 |
| Moving expenses | $500 – $2,000 |
Our complete closing costs guide breaks down everything you'll need, or use our Closing Costs Calculator to estimate your costs.
FAQ
Q: How much do I need saved before buying?
A: At minimum, your down payment plus 1.5-4% for closing costs. For a $500,000 home with 5% down, budget around $35,000–$40,000 total.
Q: Can my parents help with the down payment?
A: Yes! Gifted down payments are common. You'll need a gift letter confirming no repayment is expected.
Q: How long does the buying process take?
A: From pre-approval to closing, typically 60-90 days. See our home buying timeline guide for details.
Q: What credit score do I need?
A: Generally 620+ for approval, but 680+ gets better rates. Check our credit score improvement guide if you need to boost yours.
What's Next
Ready to start your homeownership journey? Get pre-approved today to see exactly what you can afford. Our team will guide you through every step of the process.
Ready to Get Started?
Contact us today for personalized mortgage advice and competitive rates.
