How to scrounge for your mortgage down payment

As you may or may not be aware, the Federal Government has recently introduced some changes to rules around mortgage lending that are going to take effect in February of 2016.

Until now, homeowners have been required to put 5 percent down in equity when buying a home. Canada Mortgage and Housing Corporation (CMHC), by way of the Federal Government, will now require homeowners purchasing a home over $500,000 to put 10 percent down.

The intention is to try to cool hot markets in areas like Toronto and Vancouver, where prices have been rising rapidly. As a consequence homeowners have been dangerously saddling themselves with debt.

So- if you’ve got homeownership on your horizon- or if you are trying to climb your way up the property ladder, you’ll be responsible for a greater down payment, depending on how much you are spending.

Saving more may seem like a challenge, but like all goals- with a well thought-out strategy, they are attainable!

Cut the dead wood

By dead wood- I mean cut extra spending. Think of this as short term pain for long term housing gain. Instead of eating out, eat it. Leave those credit cards at home and live a cash only lifestyle. Instead of going to the mall for the afternoon, go for a walk, or visit your local library for free activities.

There are a number of modest lifestyle changes that, when added together- will pile up in your bank account.


Wherever possible in your household, consolidate expenses. This may mean consolidating your debts in order to focus on reducing through a targeted payment.

You may also want to consolidate (or bundle) things like your phone and internet services, your insurance (home and auto) and other similar expenses. You can often get a better deal if you combine.

Extend your time horizon

One way to ensure that you’ve got enough money in the bank is to extend your target date to buy. This will likely be the new reality for some home owners under the new rules.

Rest assured that, while it is hard to wait, having more equity and less debt when it comes to home ownership is a good thing!