When your buying residential property in Regina, you must have a down payment; unless your buying the property fully in cash. But because your probably not one of those people who have hundreds of thousands of dollars sitting in your bank account, you’ll probably need a down payment.
$300,000 Home = $15,000 down
$450,000 Home = $22,500 down
$565,000 Home = $31,500 down (5% of $500K is $25,000, 10% of $65k is $6500 = $31,500)
$700,000 Home = $55,000 down (5% of $500K is $25,000, 10% of $300k is $30,000 = $55,000)
$1,000,000 Home = $200,000 down
In some instances, yes. If you are gifting a down payment to a blood relative, you will have to fill out a gift letter. Lenders are very strict on down payment rules for the following reasons:
First, the lender cares about the source of the down payment because it indicates the buyer is financially qualified to purchase the home.
Second, In order to prevent money laundering, lenders have to prove the source of the down payment on the purchase of a home (meaning they must be able to see the down payment has been in your account for 90 days and was accumulated through payroll deposits or otherwise proven ex: RRSP, inheritance etc.)
Lastly and most important to this scenario, the down payment establishes the loan to value ratio. Now, the loan to value ratio or LTV is the percentage of the property’s value compared to the mortgage amount. In Canada, a lender cannot lend more than 95% of a property’s value.
The bigger the down payment the better (as far as the lender is concerned) because there is a direct correlation between how much money someone has as equity in a property to the likelihood they will/won’t default on their mortgage. To break that down… the more equity in the home, the less likely you’ll be to default on the mortgage.
You bet they care about where the down payment comes from. The bank will not lend to someone who is not properly qualified to take on a mortgage. In the eyes on the lender, if you cannot form the down payment by yourself, you are not a good candidate ensure a mortgage to.
ONLY if they are a blood relative and you are gifting them equity out of the home and as there is no repayment schedule made. The money must be a gift that is not to be paid back. People who are unrelated cannot and should not go this route.
No. ANY cash back from the seller to the buyer when the purchase transaction closes is a big no-no.
This is called fraud. Having conditions to the sale of a property that are not disclosed to the lender is fraud. There is no 2 ways about it.
So, there you have it.
A down payment can only be in the form of saved earning or gifted from a blood relative. Down payment money can also come from an RRSP, inheritance or lottery winning. You have to be able to prove the money came from a legitimate and acceptable source.
If you have any questions about how to form a down payment and the dos and don’ts around them, I would be happy to meet and go through my home buyers guide!
Give me a call at 306-552-7047 or fill out my online contact form!
The Regina Real Estate Group delivers structured real estate strategy for buyers and sellers across Regina and surrounding communities. First-time buyers, move-up homeowners, downsizers, and investors benefit from data-driven pricing, disciplined marketing, and strategic negotiation designed to protect equity and long-term value.
With more than 450 successful transactions and deep local market insight, we provide clear guidance, preparation, and measurable results in every market cycle.
Connect with the Regina Real Estate Group for a complimentary consultation at 1-306-552-7047 and take the next step with confidence.
