You can buy a home soon after moving to Canada. Newcomer mortgage programs exist for permanent residents and many work permit holders, sometimes with as little as 5% down. This guide covers what lenders look for and how to get ready.
How do mortgages work in Canada?
A mortgage is a loan to buy a home, secured by the home itself. You choose:
- A term, usually 1 to 5 years, after which you renew
- An amortization, the total time to pay it off, often 25 years
- A fixed or variable rate
- Open or closed. Open lets you pay it off any time. Closed has a lower rate but limits on extra payments.
Learn more about the types of lenders in Canada.
What do lenders look at?
- Your status. Permanent residents have the most options. Work permit holders can qualify too, depending on the program.
- Your job. Lenders usually want to see steady full-time work in Canada.
- Your credit. If you are new and have little Canadian credit, some programs accept other proof, such as a history of paying rent on time.
- Your down payment. Where it came from and how long it has been in your account.
What documents should I gather?
- Passport and PR card or work permit
- A job letter and recent pay stubs
- Bank statements showing your down payment
- Proof of any money sent from abroad
- Any credit history you have, in Canada or from home
How do I build Canadian credit?
Get a Canadian credit card early, even with a small limit. Use a little of it each month and pay it in full. Put a phone or utility bill in your name and pay it on time. A few months of history makes a real difference.
How much down payment do I need?
With an insured newcomer program, you may be able to buy with as little as 5% down. The CMHC and other mortgage insurers set the rules, and they change, so ask us what applies to you today. Our mortgage calculators can show what different down payments mean for your budget.
Fixed or variable?
A fixed rate keeps your payment the same for the term. A variable rate moves with the market and usually has a smaller penalty if you break the mortgage early. If a steady budget matters most while you settle in, many newcomers choose fixed.
Are there programs for first-time buyers?
Yes. Newcomers can often use the same first-time buyer programs as anyone else, including land transfer tax refunds and the First Home Savings Account once you are a resident for tax purposes. See our Mortgage Corner tools.
What are the steps to buying?
- Get pre-approved. This sets your budget and shows sellers you are serious.
- Find a home that fits your budget and your daily life.
- Make an offer with the help of a realtor.
- Close. Plan for closing costs of about 1.5% to 4% of the price for legal fees, land transfer tax and other costs.
Talk to us
Kelly Foote works with newcomers every week. Book a call or phone 289-723-2126 and we will tell you which program fits your status and what to gather first.
Common questions
Can I get a mortgage as a new immigrant in Canada?
Yes. Permanent residents and many work permit holders can qualify through newcomer mortgage programs, sometimes with as little as 5% down.
Do I need Canadian credit history to get a mortgage?
It helps, but some newcomer programs accept other proof, such as on-time rent payments or credit history from your home country.
How long do I need to work in Canada before buying?
Many lenders want to see a few months of steady full-time work in Canada. The exact rule depends on the lender and the program.