Buying
Can my down payment be a gift?
Written by Stonefield Mortgage · Reviewed by David Steinfeld, principal broker · Stonefield Mortgage, FSRA mortgage brokerage licence #13722 · [review pending — before this page is indexed]
Published · Updated
Yes, in most cases: in Canada, part or all of your down payment can be a gift, usually from a close family member. Lenders generally ask for a signed gift letter confirming the money never has to be repaid, and proof that the funds are in your account before closing.
How lenders treat a gift
A lender cares about one thing with a gift: that the money is a gift and not a loan. A loan dressed up as a gift would add a debt the lender has not counted. So the gift paperwork confirms there is no repayment.
Most lenders ask for:
- A gift letter signed by the person giving the money, stating the amount, their relationship to you, and that it does not have to be repaid.
- Proof the money has been deposited into your account, usually a statement showing the transfer, before closing.
- Sometimes, a statement from the giver's account showing where the money came from.
Who can give a gift varies by lender and by whether your mortgage is insured. Gifts from parents, grandparents and siblings are the most commonly accepted. If the gift is from someone else, ask us before you rely on the gift.
If your gift does not fit a bank, credit union or monoline lender's gift rules, some alternative lenders take a broader view, usually at a higher cost. We start with the institutional options.
How the gift fits the down payment rules
A gift counts toward the federal minimum down payment the same way savings do. The minimum is 5% of the first $500,000 of the price and 10% of the portion from $500,000 up to $1.5 million; at $1.5 million or more, the minimum is 20% (source: canada.ca, checked October 2026).
For example, on a $600,000 home the minimum is $25,000 plus 10% of $100,000, which is $35,000. If your parents give you $20,000 and you have saved $15,000, you meet the minimum. With less than 20% down, your mortgage needs default insurance, and the premium is usually added to the loan.
A gift also helps with closing costs, such as land transfer tax and legal fees, which are paid in cash. Some buyers use a gift to reach 20% down and avoid the insurance premium entirely.
When to move the gift money
Lenders look at recent account history. A lender is likely to question a large deposit that appears without explanation. If family plans to help, tell us early and move the money with a clear paper trail. Keep the transfer in one piece if you can, from the giver's account to yours.
What to do next
If family is helping with your purchase, use our call-me-back form and we will tell you how to document it. You can also run your budget in the affordability calculator.
Common follow-up questions
Does the person giving the gift need to be on the mortgage?
No. A gift giver is not a borrower and is not responsible for the mortgage. If the giver would also co-sign the mortgage, co-signing is a different arrangement with its own obligations.
Can a gift come from outside Canada?
Sometimes. Some lenders accept a gift from outside Canada, with extra documentation to show where the money came from. Rules vary, so ask us before the funds are sent.
Does a gifted down payment cost more in insurance?
Generally not, when the gift comes from immediate family. Lenders and insurers treat a family gift as part of a normal down payment. A borrowed down payment is treated differently, so tell us if any part of the money would have to be paid back.
General information for Ontario readers, not financial, legal or tax advice.