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Frequently Asked Questions
What First-Time Buyer Programs are available?
Canada offers several programs and incentives designed to make homeownership more accessible to first-time buyers. At CML, we can help you explore:
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First-Time Home Buyer Incentive
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Home Buyers' Plan (HBP)
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First-Time Home Buyers' Tax Credit
Our specialists will explain how these programs work and how you can take advantage of them to reduce your costs and maximize your benefits.
Should I choose a fixed or variable interest rate?
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Fixed Rate: Your interest rate and monthly payment remain locked for the entirety of your term, offering predictability and protection against rate hikes. However, prepayment penalties for breaking a fixed rate early can be higher.
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Variable Rate: Your rate fluctuates with the lender’s prime rate. If rates drop, more of your payment goes toward the principal; if rates rise, costs increase or amortization extends. Variable rates typically come with lower penalties if broken early.
Why should I use a mortgage broker instead of going straight to my bank?
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A bank mortgage specialist only offers products from their specific institution. A licensed mortgage broker works as an independent advisor with access to dozens of lenders—including major banks, credit unions, and alternative lenders—to shop around for the best rate and features on your behalf. In standard transactions, broker services are usually free as lenders pay the broker a fee upon closing.
How much down payment do I need to buy a home in Canada?
In Canada, the minimum down payment depends on the purchase price:
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$500,000 or less: 5% of the purchase price.
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$500,001 to $1,499,999: 5% on the first $500,000, plus 10% on the portion above $500,000.
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$1,500,000 or higher: A minimum 20% down payment is required.
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Note: Any down payment under 20% requires mortgage default insurance (e.g., CMHC, Sagen, or Canada Guaranty).
What is the difference between a mortgage term and an amortization period?
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Mortgage Term: The length of time your current mortgage agreement (rates, terms, and conditions) is active, typically ranging from 1 to 5 years. You must renew or pay off the balance at the end of each term.
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Amortization Period: The total length of time it will take to pay off the mortgage in full (commonly 25 to 30 years).
How much extra money should I budget for closing costs?
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Beyond your down payment, you should budget an additional 1.5% to 4% of the home’s purchase price to cover closing costs. These costs typically include legal fees, Land Transfer Tax (which varies by province and municipality), title insurance, property valuation fees, and home inspection expenses.
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