How Much Down Payment Do I Need for a Mortgage in Alberta?
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·Reviewed by a mortgage professional
Short answer
For owner-occupied homes in Alberta, the federal minimum is 5% on the first $500,000 and 10% on the portion above $500,000 up to $1.5M. A 20% down payment avoids mortgage default insurance and allows up to 30-year amortization on many conventional mortgages.
The plain-English version
Down payment is the cash you put toward the purchase price. The mortgage covers the rest. Lenders and insurers set minimums based on purchase price and occupancy — not the province.
Below 20% down, you typically need default insurance (CMHC or private insurers), which adds a premium often rolled into the mortgage. Insured mortgages are generally capped at 25-year amortization.
Alberta-specific considerations
- Alberta has no provincial land transfer tax, so more of your cash can go to down payment vs. closing fees in other provinces.
- Gifted down payments are common — lenders require a gift letter and proof the funds are in your account.
- New-build purchases may involve GST on top of the contract price; plan cash separately from your down payment math.
Example scenario
On a $450,000 home, 5% down is $22,500. On $600,000, minimum is 5% of $500k ($25,000) plus 10% of $100k ($10,000) = $35,000. At 20% on $600,000, you need $120,000 down and skip insurance on a conventional file.
Common mistakes to avoid
- Forgetting closing costs when calculating total cash needed — down payment and closing costs are separate.
- Draining every dollar for down payment with no buffer for moving and immediate repairs.
- Assuming 5% down always qualifies — income, debts, and stress-test rules still apply.