Typically, your down payment will range from 5-20%. Most Canadians pay 20% of the property’s purchase price upfront, but it is possible to make a down payment below that percentage. You may need mortgage loan insurance to pay less than 20%, however. This protects your lender from any associated risk.
Mortgage loan insurance can cost anything between 1.8% and 3.6% of the total mortgage value. It does, however, depend on the size of the down payment you make and the scale of your mortgage.
How much of a down payment you make can influence your interest rate. A mortgage with a down payment of more than 35% will typically carry a lower interest rate than one of 20% or less. This is because a lender is protected from the risk of loss to a greater degree when a borrower makes a large down payment.