New to Canada? Here's how to qualify for a mortgage

By Jesse Abrams
February 15, 2022

If you’re new to Canada and looking to apply for a mortgage, you’re probably wondering where to even begin. Buying a home, especially in a new country, can be overwhelming. But it’s important to know that in Canada, there are plenty of helpful resources to get you on the right path.

Newcomers to Canada program

A great place to start is “Newcomers to Canada” at, a housing program offered by Canada Mortgage and Housing Corp. (CMHC) that provides financial assistance and makes it easier for new immigrants to purchase a home. If you qualify, you can make a down payment as low as five per cent on a home worth up to $1 million. If you’re looking to buy a home for more than $1 million, you’ll likely be paying a down payment of 35 per cent or higher. When it comes to credit, permanent residents must have at least one borrower with a minimum credit score of 680 to qualify. If you don’t have credit history, CMHC may consider alternative ways to verify your credit.

Where can you get a mortgage in Canada as a newcomer?

When it comes to getting a mortgage, there are A and B lenders. Traditional lenders, such as banks, monoline lenders and credit unions, are considered A lenders. They focus on customers with strong credit scores (or proof of credit) and a reliable source of income. On the other hand, there are B lenders, who typically offer a lower barrier of entry to qualify for a mortgage, with the possibility of a higher interest rate. B lenders are suitable for homebuyers who don’t have a strong credit history, can’t provide guaranteed income, or may have trouble qualifying for a mortgage with an A lender.

The best piece of advice would be to connect with a dedicated mortgage advisor such as Homewise. We work with more than 30 banks, credit unions and monoline lenders, helping buyers explore the various mortgage options available and find the one that best suits your unique circumstances.

What is the maximum mortgage amount you can get?

Technically, there is no maximum amount you can receive from the “Newcomers to Canada’’ program. The amount you’re eligible to receive will depend on the size of your down payment. Another thing to note is that your down payment can come from various sources, such as savings, the sale of another property or a financial gift from a family member or friend.

How long will it take to get the mortgage?

If you’re a new Canadian with a working permit, you need to be in Canada for at least three months to prove that you can make your mortgage payments. If you’re a permanent resident, you need to provide proof of full-time employment for three months. If you’re self-employed, you need to provide proof of employment and two years of tax documentation.

What documents do you need to apply?

When applying, lenders will initially request a list of personal documents to verify your financial stability and other key factors that determine your eligibility for a mortgage. These documents include:
• Photo ID
• This includes a driver’s license, passport and health card
• Proof of income
• At least three months of bank statements that validate your income stream
• Job letter
• Ask your employer for a letter explaining your job position, length of employment and salary/hourly wage
• Work permit or permanent residency card in Canada
• Proof of down payment

Depending on your down payment, you may require additional documentation:
1. If your down payment is between five and 9.99 per cent
You will need to provide a copy of an international credit report with a strong credit score that proves you can support your monthly mortgage payments. You could also validate your credit through rental payment history or utility bills such as your gas or water bills.
2. If your down payment is 10 per cent or more
You will need six months of bank statements or a letter of reference from a Canadian financial institution. This information will validate whether you’re eligible and able to make your monthly payments.

What happens if you have no credit history in Canada?

If your home country is the U.S., U.K. or South Africa (non-permanent resident), and you don’t have any credit history in Canada, some lenders will still consider your mortgage application. In some cases, lenders will look at your foreign credit history to better understand your eligibility. For all other countries, where your credit can’t be verified through an international credit record, you’ll likely need to get a letter of reference from your financial institution in your country of origin.

Can you buy a home on a work or study permit?

The short answer is yes. To do this, you would need to have provable income, a valid work permit or permanent residency to qualify.

At Homewise, our team has worked with many first-time homebuyers and newcomers to Canada to secure a mortgage that best suits their needs.

At the end of the day, it all comes down to doing your research, being organized and working with professional mortgage advisors like ours at Homewise to walk you through the process and help you secure a mortgage with ease.

About Jesse Abrams

Jesse Abrams is Co-Founder at Homewise, a mortgage advisory and brokerage firm based in Toronto.

Have great ideas? Become a Contributor.

Contact Us

Our Publications

Read all your favourites online without a subscription

Read Now

Sign Up to Our Newsletter

Sign up to receive the smartest advice and latest inspiration from the editors of NextHome