Down Payment
A down payment is the portion of a home’s purchase price paid upfront, with the remaining amount financed through a mortgage. In Canada, minimum down payment requirements depend on the purchase price, and different rules apply for insured versus uninsured mortgages.
A larger down payment reduces the loan amount and can lower monthly payments and total interest. It can also help avoid mortgage default insurance if the down payment reaches 20%.
Why this matters:
The down payment is one of the biggest levers you control. Understanding how it changes mortgage type and total cost helps borrowers choose between keeping cash available and reducing debt.
Related Mortgage Terms
Often confused with:
Equity — Equity is what you own over time; down payment is what you put in at the start.
Closely related:
High-Ratio Mortgage — Applies when down payment is under 20%.
Conventional Mortgage — Applies when down payment is 20% or more.
Next step:
High-Ratio Mortgage — Learn what changes when you buy with less than 20% down.