Is Bigger Always Better?

Marci • June 1, 2012

No, bigger isn’t always better, but in the case of a down payment on a home, it is almost always better. You’ll free up more money month to month by putting a bigger chunk down at the start, but remember to set aside enough for “come what may”.

Let’s look at the difference between 5% down and 25% down on the purchase of a $500,000 home. We’ll assume there is no other debt, no strata fees, $2000 property taxes and a 3.29% rate.

At 5%, the down payment is $25,000 and the mortgage is $475,000. But wait! Because you need CMHC for default insurance, the mortgage goes up to $489,012.

This equates to monthly payments of $2,133 and required income of $90,000 a year to obtain the mortgage.

At 25%, the down payment is $100,000 and the mortgage is $400,000. No CMHC or other default insurance required.

In this case, monthly payments are $1,750 and income required to obtain the mortgage is $75,500.

But wait – These days lenders are offering better rates with less (yes, less) money down. So for this same mortgage with 5% down, you might actually qualify today for a rate of 3.19%. That equates to a monthly payment of $2,106. Which is a savings of just $25 per month and total interest savings of just $2,351 over the 5 years. (As an aside, some of you are probably shocked that .10% is such a small savings! Remember, it is not all about the rate – we’ll save that for another Blog post!)

Obviously, month to month, the larger down payment is going to be more comfortable. It frees up close to $400 a month. That being said, before you think about slapping every penny on the down payment, there are other considerations.

Life is uncertain. You can budget and plan to the nickel, but that doesn’t mean things will always go as planned.  When considering how much to put down, keep in mind that you need to cover closing costs: realtor fees if selling another house, legal fees, (about $1,000) property tax adjustments ($1,000 to $2,000) Property Transfer Taxes (1% of the first $200,000 and 2% of balance on all purchases over $425,000 – download an app to help you calculate this on iTunes (search DBM app) – plus any moving costs or fees for renovations you may need to do.

Holding back part of that money gives you the funds you need when buying an older home. If the appliances, water tank or furnace look old, you’ll need cash available. Take a look around at the house you’re buying and think about some of the extras you might buy like a riding lawnmower or a desk that fits the new office space.

After you’ve reviewed the expected, keep in mind there is always the possibility of the unexpected.

The washer could stop without warning, the cat could need surgery or you may discover carpenter ants. Things change. Relationships change and situations change. Make sure there is enough money available for the unexpected. After you’ve settled into a mortgage with a down payment that allows for an emergency fund, manageable monthly payments and a reasonable household budget, you can always apply the extra money towards the mortgage later. Most mortgages allow principal reductions of up to 20% a year as well as an increase in mortgage payments by 20% without penalty. Both methods cut the interest you pay dramatically.

Ultimately, no matter what you do – make sure you leave some breathing room and don’t tie your money up too tight.

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Bank of Canada Holds Rate at 2.25% — July 15, 2026

By Marci Deane • July 15, 2026
The Bank of Canada announced today that it is holding its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%. The tone of today's announcement is notably more optimistic than previous months. Here's what's changed and what it means for you.

Let’s Talk About Getting Top Dollar for Your Property

By Marci Deane • July 8, 2026
When it comes to selling your home, most people think the first call should be to a real estate agent. But the smartest first step often isn’t with your agent—it’s with an independent mortgage professional. Why? Because your mortgage plays a bigger role in your bottom line than most people realize. Planning to Buy After You Sell If selling means you’ll also be purchasing another property, you’ll want to know exactly where you stand financially before listing. Mortgage rules change regularly, and qualifying once doesn’t guarantee you’ll qualify again. Getting a pre-approval in place ensures you know what you can afford and eliminates surprises later. On top of that, reviewing the terms of your existing mortgage could uncover options you may not have considered. For example, porting your mortgage instead of arranging a brand-new one could save you thousands. Selling Without Buying Even if you aren’t planning to buy right away, there’s still an important step: understanding the cost of breaking your mortgage. Unless your mortgage is open, penalties apply—and they can be significant. By reviewing the numbers with a mortgage professional, you might find that simply adjusting your timeline could reduce or even avoid costly fees. Navigating Life Changes In situations like a marital breakdown, it can feel like selling the family home is the only path forward. But that’s not always the case. With the right guidance and a legal separation agreement, one spouse may be able to buy out the other, keeping the home and providing stability for everyone involved. The Bottom Line Selling your property is more than just putting a sign on the lawn—it’s about creating a financial plan that protects your equity and positions you for the best possible outcome. Before you take the leap, let’s sit down and review your options. 📞 If you’re ready to talk strategy and make sure you get top dollar for your property, I’d be happy to connect anytime.

Don’t Let Collections Derail Your Mortgage Application

By Marci Deane • July 1, 2026
Can You Get a Mortgage If You Have Collections on Your Credit Report? Short answer? Not easily. Long answer? It depends—and it’s more common (and fixable) than you might think. When it comes to applying for a mortgage, your credit report tells lenders a story. Collections—debts that have been passed to a collection agency because they weren’t paid on time—are big red flags in that story. Regardless of how or why they got there, open collections are going to hurt your chances of getting approved. Let’s break this down. What Exactly Is a Collection? A collection appears on your credit report when a bill goes unpaid for long enough that the lender decides to stop chasing you—and hires a collection agency to do it instead. It doesn’t matter whether it was an unpaid phone bill, a forgotten credit card, or a disputed fine: to a lender, it signals risk. And lenders don’t like risk. Why It Matters to Mortgage Lenders? Lenders use your credit report to gauge how trustworthy you are with borrowed money. If they see you haven’t paid a past debt, especially recently, it suggests you might do the same with a new mortgage—and that’s enough to get your application denied. Even small collections can cause problems. A $32 unpaid utility bill might seem insignificant to you, but to a lender, it’s a red flag waving loudly. But What If I Didn’t Know About the Collection? It happens all the time. You move provinces and miss a final utility charge. Your cell provider sends a bill to an old address. Or maybe the collection is showing in error—credit reports aren’t perfect, and mistakes do happen. Regardless of the reason, the responsibility to resolve it still falls on you. Even if it’s an honest oversight or an error, lenders will expect you to clear it up or prove it’s been paid. And What If I Chose Not to Pay It? Some people intentionally leave certain collections unpaid—maybe they disagree with a charge, or feel a fine is unfair. Here are a few common “moral stand” collections: Disputed phone bills COVID-related fines Traffic tickets Unpaid spousal or child support While you might feel justified, lenders don’t take sides. They’re not interested in why a collection exists—only that it hasn’t been dealt with. And if it’s still active, that could be enough to derail your mortgage application. How Can You Find Out What’s On Your Report? Easy. You can check it yourself through services like Equifax or TransUnion, or you can work with a mortgage advisor to go through a full pre-approval. A pre-approval will quickly uncover any credit issues, including collections—giving you a chance to fix them before you apply for a mortgage. What To Do If You Have Collections Verify: Make sure the collection is accurate. Pay or Dispute: Settle the debt or begin a dispute process if it’s an error. Get Proof: Even if your credit report hasn’t updated yet, documentation showing the debt is paid can be enough for some lenders. Work With a Pro: A mortgage advisor can help you build a strategy and connect you with lenders who offer flexible solutions. Collections are common, but they can absolutely block your path to mortgage financing. Whether you knew about them or not, the best approach is to take action early. If you’d like to find out where you stand—or need help navigating your credit report—I’d be happy to help. Let’s make sure your next mortgage application has the best possible chance of approval.