For those of you who don’t know, your down payment is the amount of money you need to put down on your new home. Once you have determined your budget, you will have an accurate idea of the final cost of the home you can afford and what you will be intending to spend. This will allow you to estimate your down payment and start saving!
If your budget is over $500,000, keep in mind the minimum down payment will be 5% for the first $500,000 and 10% for the remaining portion. If you end up purchasing a home that is over $1 million, you will be required to put 20% down.
SOURCES OF DOWN PAYMENT
The down payment on your home could come from your own savings such as a savings account or RRSPs. Thanks to the federal government’s Home Buyers’ Plan, potential first-time home owners are able to leverage up to $35,000 of your RRSP savings ($70,000 for a couple) to help finance the down payment. A gift of a down payment from an immediate relative is also acceptable.
Quick Tip: If your down payment comes from TFSA or RRSP, the bank will want 90 days of statements to ensure the funds are accounted for. Gifted funds rarely require 90 days of proof.
It is always a good idea to check with a Mortgage Professional for qualifying criteria and availability to ensure your source of down payment is eligible.
CLOSING COSTS
After you have secured your down payment, it is also important to mention that you will need to have the closing costs available upon finalizing the purchase of your new home. These costs can range between 1 – 4% of the purchase price.
Angela Calla is a 16-year award-winning woman of influence and mortgage expert. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. She educates and empowers individuals on the “The Mortgage Show”, which she’s hosted for over a decade and is the best selling author of The Mortgage Code available on Amazon. All proceeds from her book sales are donated to Access Youth Outreach services, a local charity in our community supporting our youth. Additionally, in August of 2020 she surpassed $1 Billion dollars in funded personal mortgage volume at the young age of 37.
Angela leads by example with passion and conviction. She is known as an industry expert on TV and radio and the go-to source for publishers across the Country. She has even been known to sign the national anthem at sporting events! On top of all her achievements, Angela finds the time to be a loving wife and mother of two beautiful children.
For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or 604-939-8777.
