How Much Down Payment Do I Need in Alberta?
The short answer: in Alberta you need a minimum of 5% down on the first $500,000 of a home’s price, 10% on the portion between $500,000 and $1.5 million, and 20% on any home priced at $1.5 million or more. These are the same federal rules that apply across Canada. But here is what I tell every buyer: the amount is the easy half. Of the three pillars of a mortgage (credit, income, and down payment), down payment is the most complicated, because you do not just need the money, you need to prove where every dollar of it came from. That sourcing step is where the stress lives, and it is also completely manageable if you know the rules going in.
I have been arranging mortgages in Alberta since 2018, with access to 50+ lenders, and down payment is the pillar my team and I spend the most time on. It is the one that trips people up latest and hardest. It is also the one where almost every problem is preventable months in advance, which is the whole reason for this post.
The minimum down payment, broken down
Canada’s minimum down payment is tiered by purchase price, so the percentage you need depends on where the price falls rather than on one flat rule.
| Purchase price | Minimum down payment | How it works out |
|---|---|---|
| $400,000 | $20,000 | 5% of $400,000 |
| $500,000 | $25,000 | 5% of $500,000 |
| $700,000 | $45,000 | 5% of the first $500,000, plus 10% of the next $200,000 |
| $1,000,000 | $75,000 | 5% of the first $500,000, plus 10% of the next $500,000 |
| $1,500,000 | $300,000 | 20% of the full price |
The jump at $1.5 million looks harsh until you know the reason for it: default insurance is not available on homes at that price, so 20% is not a preference, it is the floor.
If you put down less than 20%, your mortgage carries default insurance from CMHC, Sagen, or Canada Guaranty. It is a premium added to your mortgage that protects the lender, and it is also the very thing that makes buying with 5% down possible at all. The premium is a percentage of the mortgage amount and it steps down as your down payment goes up: 4.00% at 95% loan to value, 3.10% at 90%, 2.80% at 85%, and 2.40% at 80%. On that $400,000 purchase with $20,000 down, the premium works out to about $15,200, and it gets added to the mortgage rather than paid in cash at closing.
The part nobody warns you about: proving where it came from
For most lenders, the baseline requirement is a three-month history of the bank account holding your down payment. What people don’t always understand is that it is not just showing the three-month history. It is validating every big deposit inside it. If $15,000 landed in your account from somewhere, we have to track that backwards and show a three-month history of that account too. Money that hopped between four accounts means four paper trails, and every hop is another statement the lender will ask for.
This is why down payment is the pillar we put the most work into. It can be frustrating, but it is worth understanding that the banks are not doing it to be difficult: verifying the source of funds is a need-to, not a want-to. They are required to do it. Our job is to make it as simple for you as possible.
The one-account strategy
Here is what we tell people preparing for a purchase. If you are buying right away, great, we will work with whatever your down payment looks like today. But if you are six to twelve months out, there is a simple strategy that makes the whole thing painless.
This matters most for young couples, who are often used to having multiple accounts and moving money around constantly. Every transfer you make in the months before buying is a transaction someone may ask you to explain. If you are a year out and want to know which account to park the money in, that is a five minute conversation and it is free, and it is a much better use of your time than untangling six statements later.
Where the money can come from, including gold and Bitcoin
The good news is that your down payment can come from almost anywhere these days: your FHSA, your investments, an RRSP withdrawal under the Home Buyers’ Plan, your own personal savings, the sale of another property, or a gift from immediate family (with a signed gift letter confirming it does not have to be repaid).
Non-traditional sources work too. They just take a longer runway. We have done down payments with clients who cashed out gold: we showed the proof of them purchasing the gold, then the record of it being cashed out later. We have done it with Bitcoin the same way. For crypto or any non-traditional investment, lenders typically want to see the money going into the investment, the investment account showing how it grew over time, and then the funds coming out: a complete story from purchase to cash. If that is your plan, start the paper trail early.
Money coming from outside Canada adds one more layer. I have been an immigrant myself, and I work with a lot of newcomers, so I know first-hand that showing funds arriving internationally means more documentation, not less possibility. The right lenders handle it well. It just has to be set up correctly, which is a big part of what we do on new to Canada files.
Confirm the down payment before you shop, not after
This is the reason my pre-approvals collect all of your down-payment documents up front rather than leaving them for later: it lets us flag anything a lender might question and build a strategy for showing it in the most document-efficient way possible, while there is still time to fix things calmly. If you do a pre-approval without down payment confirmation, you are going to run into problems later, usually after you have an accepted offer and a financing deadline, which is the worst possible moment to discover a sourcing issue. It is also one of the things that separates a real pre-approval from a pre-qualification wearing a better label, since the second kind never asks for a single statement.
One more budgeting note while we are here: the down payment is not the only cash you need. Plan for another roughly 1.5% to 4% of the purchase price in closing costs, covering legal fees, inspection, and title registration, though Alberta buyers catch a break, since the province charges no land transfer tax.
Get your exact number, and a clean paper trail
The tiered math takes two minutes. Setting up a down payment that sails through verification is the real preparation, especially for first-time buyers.
If your money is currently spread across four accounts, arrived from a relative last month, or came out of an investment you cannot quite explain, none of that disqualifies you. I have not yet met a down payment that could not be documented. It only becomes a problem when nobody looks at it until there is an accepted offer on the table.
Here is what a first conversation looks like. It takes about twenty minutes, it is free, there is no credit check just to talk, and you are speaking with me rather than a call centre. I will ask what you have saved, where it is sitting, and when you want to buy, and you will leave with your exact minimum number and a short list of the statements to start collecting. If the answer is that you should wait three months and let an account season, I will tell you that.
Whether you are buying this month or a year from now in Calgary or anywhere in Alberta, get in touch and we will map out both halves: your exact number, and the simplest possible way to prove it.
Related questions
Can I borrow my down payment or put it on a line of credit?
Not for the standard minimum. The Financial Consumer Agency of Canada is direct about it: the minimum down payment normally has to come from your own funds, which means savings, registered money such as an FHSA or an RRSP withdrawal, the sale of another property, or a gift from immediate family. A small number of lenders run borrowed down payment programs, but they price for the extra risk, they want stronger credit, and the payment on the borrowed money counts against your debt ratios, so it cuts your maximum purchase price at the same time as it funds your entry. If your down payment is short, it is usually cheaper to wait a few months or ask about a family gift than to borrow it.
Is putting 20% down always better than putting 5% down?
Not always, and this surprises people. Putting 20% down avoids the default insurance premium entirely, which is real money saved. But insured mortgages often carry lower interest rates than uninsured ones, because the lender's risk is covered, so the borrower with 5% down sometimes gets a better rate than the borrower with 20% down. There is also an opportunity cost in draining every account you have to reach 20% and then owning a home with no emergency fund. The right answer depends on your rate, your timeline, and what else you need the cash for, and it is a five minute calculation rather than a rule.
How much can I take from my FHSA and my RRSP for a down payment?
You can use both on the same purchase. An FHSA lets you contribute $8,000 a year to a lifetime limit of $40,000, and a qualifying withdrawal for a first home comes out tax free and never has to be repaid. The Home Buyers' Plan lets you withdraw up to $60,000 from your RRSPs, and that one is a loan to yourself that you repay into your RRSP over fifteen years. A couple who each have both accounts can assemble a substantial down payment without a dollar of it being taxed on the way out.
What if my down payment is coming from the sale of my current home?
That is common and it works, but the timing is the whole game. The lender wants to see the sale confirmed, usually through the accepted offer and the lawyer's statement of adjustments, and the equity has to actually be available on the day your purchase closes. If your sale closes after your purchase, you have a gap to bridge, and bridge financing is a normal product that most lenders offer for exactly this. Bring both dates to the first conversation, because the gap is easy to arrange in advance and expensive to solve in the last week.