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  • Writer's pictureRhelda Baschuk

I need HOW much down payment?

The answer to this question depends on whether your mortgage is insurable or UNinsurable. What is the difference between an insurable mortgage and an un-insurable mortgage? Insurable mortgages must meet the government requirements for Mortgage Default Insurance (commonly referred to as #CMHC insurance).

Uninsurable mortgages are mortgages that are over $1'000'000, and/or have amortization of >25 years, and/or are refinances. Uninsurable usually means the rate will be a bit higher because the lender has to take on the full weight of the risk. Many lenders use a sliding scale for mortgages over the Million Dollar mark. This means they would only lend up to 80% loan to value on the first million worth of value and then sometimes, 50% or 60%, for example, on the remainder of the property value.

So to purchase a $1.5 million home using a sliding scale of 80/50, you would be able to mortgage $1'050'000.

Some lenders (although few) have NOT implemented a sliding scale so they will lend up to 80% of the entire value, so using the same purchase of $1.5 million, you could borrow $1'200'000, keeping the other $150'000 in your pocket for other expenses or investments. When looking at luxury homes, it pays to use a #mortgagebroker. I have exclusive access to an "A+" lender in Alberta who will lend in #Edmonton (#YEG) and #Calgary (#YYC) using no sliding scale. Message me today to learn more!

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