No Down Payment Options

A large percentage of the clients that come to us have the same problem; good job, good credit but no down payment. This is a problem as saving money for a down payment is difficult today with the high cost of living in most Canadian centers. One alternative is obviously our 5% Cash Back Mortgage, this product gives you the down payment you need to purchase a home today. For some however, this product is something they either cannot qualify for or its simply not ideal in terms of how it is set up. So what other options does a buy have?

1) A gift from family is by far the most common source for those that have no down payment. The gift must come from an immediate family member and must be in your account 15 days prior to closing. The gift must not be a loan, the person gifting you the money must fill out a gift letter indicating that the funds are not expected back.

2) The next most common source of funds for those with no down payment is an institutional loan. As long as you qualify for the mortgage as well as the new loan, and you have the minimum required credit score, this non-traditional source of down payment is acceptable. The only draw back to this option is that unsecured funds can sometimes be difficult to get from a bank or lender.

3) Another form of gift that we see a lot of, is gifted equity. This is where you purchase a home from a family member and they give you a deal on the property. We can take the savings and use it toward your down payment in the same way that you can use gifted funds.

Although these sources are not always easy to get, they are the most common forms of down payment we see when a client has no down payment or they don't take our 5% cash back mortgage. Call one of our mortgage brokers today to see if there are other no down payment options that may work for you.