Mortgage Blog
We make mortgages easy!
How to Get a Mortgage When You’re New to Canada
April 2, 2026 | Posted by: Deepak Bansal
How to Get a Mortgage When You’re New to Canada
Apr 2
Deepak Bansal, Mortgage Broker at Dominion Lending Centres, works with many newcomers and first-generation buyers across Ontario. We know the mortgage process can feel unfamiliar when you are still settling into a new country, a new job, and a new financial system. The good news is this: being new to Canada does not automatically put homeownership out of reach. In many cases, there are workable mortgage options sooner than people expect.
What We’ll Cover:
- Who can qualify as a newcomer buyer
- What lenders usually want to see
- How down payment rules work
- What happens if you do not have Canadian credit yet
- Case study: buying in Ontario as a newcomer
- Frequently asked questions
Who Can Qualify as a Newcomer Buyer?
One of the biggest misconceptions we hear is, “I need to wait years before I can buy.” That is not always true.
In Canada, some lenders and mortgage insurers offer newcomer-friendly options for buyers who are permanent residents, and in some cases, buyers who have legal authorization to work in Canada with a valid work permit. That does not mean every file gets approved. It does mean there may be more flexibility than you expect.
In real life, we usually look at three things first:
- Your status in Canada
- Your income and job stability
- Your available down payment
If those pieces are reasonably strong, we can often build a path forward.
What Lenders Usually Want to See
Every lender has its own policy, but the documents are usually very similar.
Expect to provide:
- Government-issued ID and immigration documents
- Proof of employment or an employment letter
- Recent pay stubs
- Proof of down payment
- Bank statements
- Details of any debts or recurring obligations
If your down payment is coming from outside Canada, that is not automatically a problem. It just means the paper trail matters. We want to be able to show where the money came from, where it has been held, and how it is arriving here.
That is where many newcomer files are won or lost. Good documentation makes the file easier to approve.
How Down Payment Rules Work
For insured owner-occupied purchases, buyers can still enter the market with a relatively modest down payment, depending on the purchase price. On homes up to $500,000, the minimum down payment is 5%. On homes above $500,000 and below $1.5 million, the rule is 5% on the first $500,000 and 10% on the remaining portion. At $1.5 million or more, mortgage insurance is not available, so buyers need at least 20% down.
Simple example:
- Purchase price: $700,000
- 5% of first $500,000 = $25,000
- 10% of remaining $200,000 = $20,000
- Minimum down payment = $45,000
That number surprises a lot of buyers. They assume they need 20% right away, and often they do not.
What If You Do Not Have Canadian Credit Yet?
This is another area where people get discouraged too early.
If you do not have much Canadian credit history yet, some lenders and insurers may still consider your file using alternative ways to assess creditworthiness. That can include rent history, utility payments, or other documented payment habits, depending on the lender.
That said, stronger files usually move more smoothly. If you have recently arrived, it helps to start building a Canadian credit footprint as soon as possible by using a credit card responsibly, paying bills on time, and keeping balances manageable.
What If You Have Not Started Working Yet?
This is where the conversation gets more case-by-case.
If you do not yet have employment in Canada, qualifying becomes much harder through the standard mortgage channels. Some lenders may consider strong net worth or large down payment files, but those are not the same as a mainstream insured mortgage approval.
In plain English: if you have a stable job, your mortgage options are usually much better.
Why Pre-Approval Matters More for Newcomers
If you are new to the country, do not shop for homes first and figure out the financing second.
Get the mortgage strategy mapped out early.
A pre-approval or upfront review can help you understand:
- How much you may qualify for
- What documents are missing
- Whether your down payment source works
- Which lenders are more newcomer-friendly
It takes a lot of guesswork off the table, and during a move to a new country, less guesswork is a very good thing.
Case Study: Buying in Ontario as a Newcomer
Background: A couple moved to Ontario from India. One spouse had a full-time salaried job earning $92,000 a year. The other had recently started part-time work. They had saved the equivalent of $70,000 for a down payment, with some funds already in Canada and the rest recently transferred.
The challenge: They assumed they would need a long Canadian credit history before qualifying. They also were not sure whether their transferred funds would be accepted.
The solution: We organized the down payment trail, collected immigration and employment documents, and structured the application around the stronger income earner while showing the household’s overall financial stability.
The math:
- Purchase price: $650,000
- Minimum down payment required: $40,000
- Available down payment: $70,000
Outcome: Because the file was documented properly, they were able to move forward much sooner than they expected and buy a home that fit their budget without waiting years.
Glossary of Terms
- Permanent Resident: A person who has been granted permanent resident status in Canada.
- Work Permit: Legal authorization to work in Canada for a defined period.
- Insured Mortgage: A mortgage with default insurance, typically used when the down payment is under 20%.
- Alternative Credit: Non-traditional proof of payment history, such as rent or utilities.
- Pre-Approval: An early lender review that estimates how much you may qualify to borrow.
- Down Payment: The upfront portion of the purchase price paid by the buyer.
Frequently Asked Questions
Can I get a mortgage if I am new to Canada and do not have long credit history?
Yes, potentially. Some lenders and insurers have newcomer options that can work even if your Canadian credit file is still limited.
Do I need to be a permanent resident to buy a home?
Not always. Some programs may also be available to buyers with valid work permits, depending on the lender and insurer.
Can my down payment come from overseas?
Yes, in many cases it can. The key is having a clean, documented paper trail that shows the source of funds.
Should I wait until I have been in Canada for a few years?
Not necessarily. It depends more on your income, down payment, documentation, and status than on simply waiting.
What is the best first step?
Start with a mortgage review before you start house hunting. That gives you a realistic budget and helps us spot any issues early.
Let’s Build the Right Plan First
If you are new to Canada and wondering whether buying is realistic, the best next step is not guessing. It is getting clear on your numbers, your documents, and the lenders that fit your situation.
Give us a call or fill out an application at this link and we’ll walk you through your options step by step.
