Benefits of a Large Down Payment - Jethro Seymour - Top Midtown Toronto (Davisville Village ,Leaside) Real Estate AgentJethro Seymour – Top Midtown Toronto (Davisville Village ,Leaside) Real Estate Agent
Your search results

Benefits of a Large Down Payment

Posted by seymour on October 10, 2014
| 0

Benefits of a Large Down Payment

greatersavingsThe size of a down payment can vary. Depending on the type of mortgage, down payments generally range from 5% to 20% of the purchase

To obtain a conventional mortgage, home buyers are required to put down at least 20% of the purchase price or appraised value (whichever is less) as a down payment. If you don’t have the necessary time or resources to save a full 20% down payment, you can choose a high-ratio mortgage and buy a home with a down payment of as little as 0%. This option is called a high-ratio mortgage and it requires you to purchase default

Whether you choose a conventional or a high-ratio mortgage, one thing is almost always certain: the larger your down payment, the more you save in the long

Want more information? Visit the Canada Customs and Revenue Agency Publication.

A larger down payment…

Reduces the amount of your monthly principal and interest payment
Reduces the total amount of interest you pay over the life of your mortgage

homebuyersplanAsk about the RSP Home Buyers’ Plan

The RSP Home Buyers’ Plan (HBP) lets a first-time buyer withdraw up to $20,000 from RSPs for a home purchase. The withdrawn amount must be repaid within 15 years, subject to a minimum annual repayment that is 1/15 of the amount withdrawn. If the full $20,000 is withdrawn, the minimum annual repayment is $1,333. If less than the minimum is repaid in any particular year, the balance is added to the taxpayer’s income.

Insuring Your High-Ratio Mortgagehighratiomort

CMHC or Genworth Financial may insure a mortgage for up to 100% of the lending value of the house. Therefore, purchasers do not need a down payment. Eligible borrowers include anyone who buys a home in Canada intending to occupy it as their principal residence.

Purchasers can use up to 32% of their gross family income for payments of mortgage principal and interest, property taxes and heating. A buyer’s total debt load (including consumer loans, etc.) cannot exceed 40% of the gross family income.

People who insure a mortgage loan with CMHC or GEMICO pay a premium. The premium is based on the down payment and loan amount. A list of the mortgage insurance premiums can be found here.

  • Cost: Premiums can be paid up front or added to the principal amount of the mortgage.
  • Loan Amount: Up to 0%of the lending value of the house.
  • Mortgage Term: To be set by the lending institution.
  • Max. House Price: Varies by market.

Want more information? Visit the Canada Mortgage and Housing Corporation or Genworth Financial websites.


For more information on obtaining a mortgage please complete the form below.

* indicates required field

  • Testimonials

    109 FRONT STREET EAST, SUITE 331 DOWNTOWN TORONTO, from Jethro Seymour, one of the top Toronto Real Estate Broker
    First Time Home Buyers Thrilled with Downtown Toronto Condo
    Their perfect condo in an ideal location

    "As first time buyers, we grew tired of working with agents who did not seem to understand our needs. Our mortgage broker spoke highly of Jethro and recommended his services to us.

    We were looking for a home for about two months. It was great to have such a knowledgable agent working with us. He showed us a variety of homes in many of Toronto’s great neighbourhoods.
    Jethro even accommodated our schedule and would take us out to look a homes last minute.

    Jethro is professional and..."

    More Testimonials
  • Neighbourhood Information

    Casa Loma Neighbourhood Real Estate

    Casa Loma: One of the Most Desirable Neighbourhoods in Toronto A comprehensive neighbourhood guide to Casa Loma and its homes ...
    Read More
  • Community Corner

    Seymour Contests: January 2017 Spa Giveaway

    Happy January, everyone! Last month’s lucky winner, Cathy Philips, won herself a $80 gift certificate to McSorley’s on Bayview. Congratulations! Thank ...
    Read More