Can my parents give me money for a down payment in Ontario?
Yes, receiving a gift from a parent or other family member to help with a down payment is common and permitted by most lenders, including those offering insured mortgages. However, lenders have specific requirements around gift money that you must satisfy during the mortgage application process.
Most lenders require a signed gift letter confirming that the funds are a true gift and not a loan — meaning there is no repayment obligation. The lender will want to see the gift deposited into your account (rather than transferred directly at closing), and may require bank statements showing the deposit. Some lenders also want a bank statement from the donor confirming the funds came from them.
If the gift is actually structured as a loan — even an informal one with the understanding that you will repay it — and you do not disclose this to your lender, that is mortgage misrepresentation. Be transparent with your lawyer and lender about the source of all funds used for your purchase.
Key takeaways
- Lenders permit gifted down payments from family members.
- A signed gift letter confirming no repayment obligation is typically required.
- The gift should be deposited into your account and traceable from the donor's account.
- Disguising a loan as a gift to obtain a mortgage is misrepresentation.