Down Payment: How Much, Where From, How to Save | Canada

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The down payment in Quebec can come from multiple sources. The HBP (Home Buyers' Plan) allows withdrawing up to $60,000 per person ($120,000 for a couple) from your RRSP tax-free, repayable over 15 years. The FHSA (First Home Savings Account) allows deductible contributions of $8,000/year up to $40,000, with tax-free withdrawals for purchase. Family gifts are accepted by lenders with a gift letter confirming no repayment is expected. Personal savings remain the most common source. For down payments under 20%, mortgage loan insurance (CMHC, Sagen, Canada Guaranty) is mandatory, adding 2.8-4% of the borrowed amount. An AMF-certified mortgage broker in Quebec analyzes your situation free of charge and compares offers from multiple lenders to get you the best available conditions. The LDPSF requires them to act in your best interest, ensuring professional and objective advice to optimize your mortgage.

Accumulating Your Down Payment: All Options

The down payment is often the biggest obstacle to homeownership. Here are all sources available in Quebec.

Government programs

HBP: RRSP withdrawal up to $60,000 tax-free ($120,000 per couple)
FHSA: $8,000/year deductible, $40,000 max, tax-free withdrawals
First-Time Home Buyer Incentive: shared equity interest-free loan (if eligible)

Other down payment sources

Personal savings (TFSA, savings account)
Family gifts (with required gift letter)
Non-HBP RRSPs (taxed at withdrawal)
Sale of existing assets

An AMF-certified broker helps you structure your down payment and optimize available programs.

The Quebec Real Estate Market for Buyers

Homeownership in Quebec fits within a specific regulatory and fiscal framework. OSFI's B-20 stress test reduces borrowing capacity by 15 to 20% compared to the theoretical amount at the contractual rate. Mortgage loan insurance (CMHC, Sagen, or Canada Guaranty) is mandatory for any down payment below 20%, adding 2.8 to 4% to the borrowed amount. Transfer duties (welcome tax) in Quebec follow a progressive scale from 0.5% to 2.5% depending on price brackets. The Home Buyers' Plan (HBP) allows withdrawing up to $60,000 per person from your RRSP tax-free, and the First Home Savings Account (FHSA) offers up to $40,000 in deductible contributions with tax-free withdrawals for purchase.

Your Purchase Action Plan

Purchasing a property in Quebec is a project that requires methodical preparation. Start by establishing a realistic budget that goes beyond the bank calculator. Include all costs: down payment, closing costs (3-5% of price), transfer duties, notary ($1,000-$2,500), inspection ($500-$800), and tax adjustments. Plan an emergency reserve of 3 to 6 months of payments. Consult an AMF-certified broker for mortgage pre-approval and a 120-day rate hold. Work with an OACIQ-certified real estate broker for the search and negotiation. Draft a purchase offer conditional on inspection and financing to protect your interests.

Protecting Your Real Estate Investment

Buying a property is the most important financial project of your life. In Quebec, you benefit from a solid regulatory framework with the AMF overseeing mortgage brokers, the OACIQ overseeing real estate brokers, and the notarial process securing the transaction. An AMF-certified mortgage broker accompanies you free of charge from start to finish, from pre-approval to disbursement. They compare offers from multiple lenders, negotiate the best conditions, and ensure you understand every aspect of your mortgage commitment. Never make the most important financial decision of your life without professional consultation.

Frequently Asked Questions

How much can I withdraw from the HBP?

$60,000 per person, $120,000 for a couple. Repayable over 15 years starting the 2nd year after withdrawal.

Is the FHSA advantageous?

Yes. Double tax benefit: deductible contributions AND tax-free withdrawals. $40,000 lifetime maximum.

Are family gifts accepted?

Yes. A signed gift letter confirming no repayment is expected is required by lenders.

Can I combine HBP and FHSA?

Yes. It's the optimal strategy to maximize the down payment: $60,000 HBP + $40,000 FHSA = $100,000 per person.

What impact does the down payment have on mortgage insurance?

Under 20%: mandatory insurance (2.8-4%). Above 20%: no insurance required, significant savings.