Buyers typically need a minimum 5% of the purchase price as a down payment, though some lenders now have mortgage options that allow you to borrow your down payment, and/or a relative can provide you with a gift of a down payment. Other than any such gift funds, you must prove to the financial institution or lender that your down payment is from your own funds. Other than any gift funds, you must prove to the financial institution or lender that your down payment is from your own funds.
If your down payment is less than 20% of the purchase price, you need a high ratio mortgage and it has to be your primary residence (i.e. you can’t rent it out). Lenders require borrowers to obtain mortgage insurance for high ratio mortgage, since they can be riskier for financial institutions. Your mortgage insurance premium will vary depending on the size of your down payment relative to the price of the property, but ranges from under 1% of the purchase price to more than 3%. If your down payment is 20% of the purchase price or more, you do not require mortgage insurance.