Tools to Help You Buy Smarter

The federal mortgage stress test requires you to qualify at the higher of: the Bank of Canada's minimum qualifying rate (currently 5.25%) or your actual contract rate plus 2%. This means if you're offered a 5-year fixed rate of 4.5%, you must demonstrate you can afford payments at 6.5%. The stress test applies to all insured and most conventional mortgages. It effectively reduces your maximum purchase price by approximately 20% compared to qualifying at your actual contract rate.

A bank can only offer its own mortgage products. A mortgage broker like Caxton & Lucke accesses 40+ lenders — including major banks, credit unions, monoline lenders, and alternative lenders — and shops the market on your behalf. Brokers are compensated by the lender (not you) in most cases, meaning you get expert advice and a broader product selection at no direct cost. For borrowers with complex situations (self-employed, newcomer, move-up), a broker's breadth of access is particularly valuable.

For homes priced under $500,000, the minimum is 5%. For homes between $500,000 and $999,999, the minimum is 5% on the first $500K and 10% on the remainder. For homes $1,000,000 and over, the minimum is 20% (no mortgage insurance available). Given that much of Vaughan, Thornhill, and Richmond Hill has detached homes in the $900K–$1.3M range, many York Region buyers need to plan for a 10–20% down payment. We can help you determine your realistic target.

If your down payment is less than 20%, your mortgage must be insured through CMHC, Sagen, or Canada Guaranty. The insurance premium ranges from 2.8% (for a 15–19.99% down payment) to 4% (for a 5–9.99% down payment) of the mortgage amount, and is typically added to your mortgage balance rather than paid upfront. Mortgage insurance protects the lender — not you — but it does allow you to purchase with a smaller down payment and often access better rates.

Most buyers should budget 1.5–4% of the purchase price for closing costs, including: Ontario Land Transfer Tax (and Toronto LTT if applicable — though York Region is exempt), legal fees ($1,500–$3,000), title insurance (~$300), home inspection (~$500), property tax adjustment, and moving costs. First-time buyers in Ontario may qualify for a Land Transfer Tax rebate of up to $4,000. We walk every client through closing cost estimates as part of our free strategy session.

A mortgage pre-approval is a conditional commitment from a lender confirming they would lend you up to a specific amount at a specific rate, based on the financial information provided. Pre-approvals typically hold a rate for 90–120 days. They are not a final approval — the property still needs to be appraised and your financials verified at the time of offer. That said, having a pre-approval significantly strengthens your negotiating position and helps you search with realistic budget confidence.

The FHSA is a registered account introduced in 2023 that allows first-time home buyers to contribute up to $8,000 per year (lifetime max $40,000) in tax-deductible contributions — similar to an RRSP — that can be withdrawn tax-free for a qualifying home purchase, similar to a TFSA. This is one of the most powerful savings tools for first-time buyers currently available. If you haven't opened an FHSA yet, every year you wait is a lost contribution room you can't recover.