London & Southwestern Ontario
First-Time Home Buyer Mortgage in London, Ontario
Buying your first home in London means budgeting for more than the down payment, and understanding how lenders read your income before you fall in love with a listing.
This page walks through the numbers in the order they actually matter.
Nandan Bajani · Licensed Mortgage Agent | Ontario · The Mortgage Firm Inc.
Down payment: how much you truly need
Minimum is 5% of the first $500,000 and 10% of any portion between $500,000 and $999,999. Under 20% down, mortgage default insurance applies and the premium is added to your mortgage balance. Funds must be traceable for 90 days; gifted down payments from immediate family are accepted by most lenders with a signed gift letter.
Closing costs London buyers forget
Set aside roughly 1.5% to 3% of the purchase price beyond your down payment.
- Ontario land transfer tax, with a first-time buyer refund of up to $4,000 for eligible buyers
- Lawyer fees, title insurance and disbursements
- Home inspection and, where required, appraisal
- Property tax and utility adjustments owed back to the seller
- Moving costs and immediate repairs
How lenders decide what you can afford
Two ratios drive it. Gross Debt Service compares housing costs — principal, interest, property taxes and heat — to gross income. Total Debt Service adds every other monthly obligation. Both are calculated at the stress-test qualifying rate, not your contract rate.
Programs worth asking about
Eligibility rules change and depend on your situation, so treat these as questions to raise rather than guarantees: the Home Buyers' Plan RRSP withdrawal, the First Home Savings Account, the federal First-Time Home Buyers' Tax Credit, and the Ontario land transfer tax refund. I'll confirm what currently applies to your file rather than quoting a number that may have moved.
London-specific considerations
Older neighbourhoods such as Old North and Wortley Village often mean knob-and-tube or aluminum wiring questions from insurers; that affects financing more often than people expect. Newer subdivisions in Summerside, Sunningdale and north of Fanshawe Park Road may come with builder timelines and new-build financing rules. Student-rental purchases near Western or Fanshawe are underwritten differently from owner-occupied homes.
Related reading
Questions people ask
How much income do I need to buy a home in London, Ontario?+
It depends on price, down payment, property taxes, heating costs and your other debts — all run at the stress-test rate. Rather than quote a figure that may not fit you, I'll run your actual numbers.
Can my parents gift my down payment?+
Most lenders accept gifted down payments from immediate family with a signed gift letter and proof the funds were transferred and are non-repayable.
Is a 30-year amortization available to first-time buyers?+
Longer amortizations are available in defined circumstances, including some insured first-time buyer and new-build scenarios. Whether it applies depends on current insurer and lender rules at the time of your application.
Should I buy with less than 20% down?+
Sometimes yes — waiting to save 20% can cost more than the insurance premium if prices or rates move. It's a math question specific to your timeline.
What credit score do I need?+
Prime lenders generally look for 680 or higher, with lower scores possible on insured and alternative options depending on the rest of the file.
Plan your first London purchase with real numbers
A short conversation is usually enough to know what's realistic. No obligation, no pressure.