# What are the rules for my down payment?

> Minimum down payment is 5% on the first $500K, 10% on the portion from $500K–$1.5M, and 20%+ above $1.5M — funds must be seasoned 90 days or documented as a gift.

Category: Purchasing
Last verified: 2026-02-18
Source: https://ratellow.com/faqs/purchasing/what-are-the-rules-for-my-down-payment

## Answer
| Down Payment Source          | Verification Required | Eligible for Down Payment? | Notes                                                              | 
|-------------------------------|----------------------|-------------------------------|--------------------------------------------------------------------| 
| Personal Savings              | Bank Statements        | Yes                           | Standard practice.                                                 | 
| Gift from Family              | Gift Letter           | Yes                           | Must confirm non-refundable.                                        | 
| Borrowed Funds                | Loan Documents        | No                            | Typically not allowed due to increased risk.                        | 
| Cash Back Incentives          | Purchase Agreement     | No                            | Not considered part of the down payment.                             | 
| Affordable Housing Program Rebate | Program Documentation | Yes                           | Approved rebates can be used.                                        |

## Institutional highlights
- We need to confirm your down payment is from your own savings or resources.
- If someone gifts you your down payment, we need a letter confirming it's a gift, not a loan.
- Using borrowed money for your down payment increases the risk, so we'll need to assess that carefully.
- Generally, 'cash back' incentives can't be used as part of your down payment.
- However, rebates can be used for your down payment if you're in an affordable housing program funded by the government.

## Related guide
- https://ratellow.com/guides/land-transfer-tax-explained

## Sources
- Property value used for the LTV ratio — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-2017
- 4.1.10 Real estate exposures — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/capital-adequacy-requirements-car-guideline-2026
- Page 2 — https://assets.cmhc-schl.gc.ca/sf/project/cmhc/pdfs/factsheets/new/cmhc-quick-reference.pdf#page=2