First-time home buyer
guide — every step,
clearly explained.
5% down, the stress test, CMHC insurance, the FHSA, the RRSP Home Buyers’ Plan, land transfer rebates and closing costs — in the order you’ll meet them.
Four things every first-time
buyer needs to know.
This guide covers each one in plain language — in the order you’ll encounter it from first question to keys in hand.
Down payment tiers, clearly explained
5% on the first $500,000, 10% on the portion up to $1.5M, and 20% on homes above that. The tiers stack — a home just over $500,000 doesn't suddenly need 10% on the whole price.
Stack every tax-advantaged dollar
The FHSA gives you up to $40,000 tax-free with no repayment. The RRSP Home Buyers' Plan adds up to $60,000, repaid over 15 years. You can use both — $100,000 per person before you touch after-tax savings.
How lenders actually qualify you
You're tested at your contract rate + 2% or 5.25%, whichever is higher. GDS must stay under 39% and TDS under 44% at that qualifying rate. Existing debts shrink your maximum.
The cash you need beyond the down payment
Budget 1.5%–4% of the purchase price for land transfer tax, legal fees, title insurance and adjustments. Ontario and Toronto first-time buyers can claim rebates of up to $8,475 combined.
From first question
to keys in hand.
Build your down payment, get pre-approved, and close — in that order. Each step sets up the next.
Build your budget and down payment
Open an FHSA, plan your RRSP HBP withdrawal, line up any gift letters, and run the affordability calculator so your price range is one a lender will actually fund at the stress-test qualifying rate.
Get pre-approved — before you house-hunt
One application goes to 100+ lenders. We review your income, credit and down payment, lock a rate hold of up to 120 days, and give you a documented maximum to shop inside.
Make your offer and close
Keep a financing condition in your offer while the lender approves the property. Your lawyer applies the land transfer tax rebate, registers the home in your name, and hands you the keys.
We can help whatever
your situation.
Tap any situation below to see how this guide — and our advisors — address it.
If you’re…You're just starting out and don't know what 'stress test' means
You're just starting out and don't know what 'stress test' means
This guide opens with exactly that — the minimum down payment, the qualifying rate, and the debt ratios — so you understand the numbers before you talk to a lender.
Start my pre-approvalIf you’re…You're deciding between the FHSA and the RRSP Home Buyers' Plan
You're deciding between the FHSA and the RRSP Home Buyers' Plan
You don't have to choose — they stack. The guide explains when to draw from each account first, and why the order matters for your taxes and repayment schedule.
Model my programsIf you’re…You're worried your income won't pass the stress test
You're worried your income won't pass the stress test
We walk through GDS, TDS and what lenders actually test, plus four ways to raise your qualifying maximum — from clearing a debt to adding a co-applicant to extending to 30 years.
Run the stress test calculatorIf you’re…You're buying in Ontario and want to claim the land transfer tax rebate
You're buying in Ontario and want to claim the land transfer tax rebate
Ontario rebates up to $4,000 and Toronto rebates up to $4,475 — eligibility rules apply and your lawyer needs the paperwork at closing. The guide covers both.
Estimate my rebateIf you’re…You want a 30-year amortization and aren't sure if you qualify
You want a 30-year amortization and aren't sure if you qualify
First-time buyers on insured purchases have had access to 30-year amortizations since December 15, 2024. The guide explains the trade-off versus 25 years and how to model both.
Apply with 30-year optionIf you’re…You're ready to get pre-approved but want to know what to expect
You're ready to get pre-approved but want to know what to expect
The pre-approval section lists every document you'll need — ID, income proof, bank statements, gift letters — so there's no scramble when your offer goes in.
Start Pre-ApprovalMinimum down payment —
how the tiers work.
Each rate applies only to the slice of the price in its band. A home just over $500,000 doesn’t suddenly need 10% on the whole amount.
| Purchase price | How the minimum is calculated | Minimum down payment |
|---|---|---|
| $400,000 | 5% of $400,000 | $20,000 |
| $500,000 | 5% of $500,000 | $25,000 |
| $700,000 | 5% of $500,000 + 10% of $200,000 | $45,000 |
| $800,000 | 5% of $500,000 + 10% of $300,000 | $55,000 |
| $1,600,000 | 20% of the full price (no insurance available) | $320,000 |
Illustrative — program rules and thresholds change. Confirm current limits with your broker before you rely on a number for an offer. Try the down payment calculator.
Common questions,
clear answers.
Down payment, FHSA, stress test, rebates and pre-approval — answered plainly.
How much do I need for a down payment as a first-time buyer in Canada?
You need 5% on the first $500,000 of the purchase price, 10% on the portion from $500,000 up to $1.5 million, and 20% on homes priced at $1.5 million or more. On a $700,000 home that works out to $45,000. With less than 20% down you'll also need mortgage default insurance, usually through CMHC.
Can I use the FHSA and the RRSP Home Buyers' Plan together?
Yes. They're separate programs and you can combine them: up to $40,000 in FHSA contributions withdrawn tax-free, plus up to $60,000 from your RRSP through the Home Buyers' Plan, repaid over 15 years. Two spouses can each use both, so a couple can assemble a much larger tax-advantaged down payment together.
What land transfer tax rebate do first-time buyers get in Ontario?
Ontario's first-time buyer refund is up to $4,000. If you buy in the City of Toronto, which charges its own municipal land transfer tax, you can also claim a Toronto rebate of up to $4,475. Generally you must never have owned a home anywhere and must live in the property. Your lawyer usually claims the rebate at closing.
Can first-time buyers get a 30-year amortization?
Yes. Since December 15, 2024, first-time buyers and buyers of newly built homes can access a 30-year amortization on an insured mortgage instead of the standard 25 years. It lowers the monthly payment, but you'll pay more interest over the life of the loan and you still have to pass the stress test. Confirm current eligibility rules with your broker.
Does the stress test apply to first-time buyers?
Yes. You're qualified at the greater of your contract rate + 2% or 5.25%, and your GDS and TDS ratios are calculated at that rate. With less than 20% down your mortgage is insured, and the same qualifying rate applies at every lender, credit unions included. Only with 20% or more down can some provincially regulated credit unions use their own qualifying rules.
How much should I budget for closing costs?
Plan for roughly 1.5% to 4% of the purchase price on top of your down payment. That covers land transfer tax, legal fees, title insurance, a home inspection and adjustments. First-time buyer rebates can reduce the land transfer tax portion significantly.
Does getting pre-approved hurt my credit?
A full pre-approval involves a hard credit inquiry, which can lower your score slightly; the effect usually fades within months. Through a broker, one inquiry can be shopped across many lenders instead of a separate check at each bank. An early estimate or pre-qualification can usually be done with no score impact.
Do I have to pay a mortgage broker as a first-time buyer?
On standard residential deals, no. The lender pays the broker, so guidance and pre-approval are typically free to you. If a specialized file ever calls for a fee, it's disclosed in writing before you agree to anything.
We’ll try to beat your rate.
If we can’t, we pay you $500.¹
¹ Rate Beat: eligible Big-6 bank written offers only · same product, term & amount · $500 paid to you or your nominated charity at closing · conditions apply
Find a specialist in your city
The programs are national, but the price bands, land transfer taxes and lender preferences are local. Find a first-time buyer specialist who knows your market.