The Flexdown
Mortgage

If you have no down payment saved you can still get a mortgage and buy a home!

Yes these still exist! Back in 2015 the Federal Government changed mortgages for homebuyers with no down payment saved and these changes were a good thing. Previously, most No Down mortgages were simple Cash back mortgages provided by the bank, these were incredibly expensive and always overshadowed the less expensive Flexdown Mortgages. These mortgages are:

  • affordable, flexible and offer a discounted mortgage rate
  • offer significant savings compared to waiting years to save
  • perfect for a growing family who require a bigger home
4.44%
Fixed Rate
OAC. Rates subject to change without notice
Calculate pre-approval What are the costs? No Down Video

Calculate your estimated pre-approval with the Flexdown mortgage

CALCULATE

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Compare the savings and costs when
you go Flexdown

You can use this calculator to get a rough idea of what the cost and benefits are. First select the estimated purchase price of the home you wish to buy. If you aren’t sure what you can qualify for please use our pre-approval calculator above to get an idea. Next is rent, this is straight forward, but if you live with family we recommend selecting a realistic amount if you were to move out. Last, your current savings. Please select the amount you are saving per month currently.

This Flexdown mortgage calculator provides two benefits: money saved from missing out on home appreciation and the numbers of years sooner you are purchasing a home of your own. The two costs are Canada Mortgage and Housing Corporation additional one-time premium along with the additional interest cost of borrowing the 5% down payment.

HOME APPRECIATION

$0

This is the estimated amount of home equity you will gain - or miss out on - during your down payment savings period. We used average inflation of 3% to calculate the home appreciation.

TIME TO PURCHASE

$0

This is how long it will take you to save up the full 5% down payment or, on the flip side, the benefit of owning your own home years sooner even with no down payment.

HIGHER CMHC FEE

$0

For every $100,000 borrowed Canada Mortgage and Housing Corporation charges a slightly higher, one-time premium of $250 for the Flexible down payment mortgage.

DOWN PAYMENT INTEREST

$0

This is the cost of the borrowed 5% down payment, as the bank and seller of the property will still require a deposit, this amount is calculated using a rough interest rate of 7% over five years.

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in a Nutshell

Why read when you can watch a video as we always say! Discover how this type of mortgage works through our quick two minute video. Learn more of the process, what the requirements are, the costs, and the benefits you may expect. On a side note the rolling human was suppose to be a rolling piggy bank - not sure what our video animators were thinking.

For more videos visit us at:  

Provider of the Flexdown program

SAGEN provides default mortgage insurance to banks and lenders. SAGEN operates the Flexdown mortgage program which allows for non-traditional down payment sources. Under their program applicants must be permanent Canadian residents, have good credit, and not have a mortgage with SAGEN insurance currently.

How Flexdown Mortgages Work

If you are looking to purchase a home and have no down payment but you have good income and good credit, then you can still purchase a home. Federal mortgage rules require a minimum down payment of 5%, however they do allow flexibility on the source of that down payment. Under the Flex down program you may borrow all or a portion of the down payment.

I thought these didn't exist anymore?

This is the reaction we often get from our client’s, and it’s understandable considering the confusion in the industry with regards to no down mortgage program. The cause of this confusion originates from the Government of Canada’s changes to mortgage regulation, specifically OSFIs B-20 and B-21 legislation. These changes no longer permit Cash Back no down mortgage programs - this is where the lender provides the 5% down payment as well and the mortgage but then recoups their cost through an inflated mortgage rate. When the Cash Back for down payment ended, so to did most of the banking industries participation in this market.





OSFI effectively cancelled the Cash Back mortgage but continued to allowed Flexible Down Payment programs, providing Canadian home buyers with an avenue to purchase a home even if they had no down payment saved.

How some homebuyers end up with no down payment available

While every one of our client’s situations is different there are some common obstacles to saving a down payment that we run into often. The first, and the one that encourages us to continue working with flexible down payment programs, is the future home owner who had saved up their down payment, but were forced to use it due to family emergency. We’ve encountered situations where an unexpected family medical expense drained a couple’s down payment savings and other situations where savings were withdrawn to help a family member purchase a home.

But unexpected expenses aside, it isn’t easy saving for a home, especially when the value of that home increases consistently. Many home buyers feel they just can't get ahead, and having no down payment just holds them at a disadvantage. Good news is: we have a solution!

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