Can my parents gift me the down payment for a house in Canada?

Yes. Gifted down payments from immediate family are accepted by essentially every lender and are close to standard for first-time buyers in the Greater Toronto Area. The lender needs a signed gift letter, evidence of where the money came from, and confirmation the funds have landed in your account before closing.

What does a mortgage gift letter need to include?

The name of the giver and their relationship to you, the amount, an explicit statement that the money is a gift with no expectation of repayment, confirmation that the giver takes no interest in the property, and signatures from both the giver and the borrower. Most lenders have their own form and it is safer to use theirs than a generic template.

How long do gifted down payment funds need to be in my account?

The minimum is generally 15 days before closing, but the target should be 90 days of clean account history before you apply, because of enhanced anti-money-laundering due diligence on down payment funds. Lenders can also ask to see the money in the giver's account before the transfer, not only arriving in yours.

Can the whole down payment be a gift?

There is no cap on the gifted portion, and the entire down payment can be gifted on most programmes, provided the rest of the file qualifies on its own. A gift does not fix insufficient income, because no lender will approve a payment the borrower cannot carry.

Answers › First-Time Buyers

My parents are giving me the down payment. Will the lender have a problem with that?

Answered by Rajiv Verma, Mortgage Broker · Updated August 2026 · About a 4 minute read

The direct answer

No — gifted down payments are completely normal, and in Brampton they are close to standard for first-time buyers. What the lender needs is proof that it is genuinely a gift and not a loan you have to repay. That means a signed gift letter, evidence of where the money came from, and confirmation it has landed in your account before closing. Handled at the start it is a non-event. Discovered a week before closing, it becomes the thing that delays your deal.

THE SHORT VERSION

Gifts from immediate family are accepted by essentially every lender
It must be a true gift — no repayment, no side arrangement
You’ll need a signed gift letter naming the giver and the relationship
You’ll need to show where the money came from and that it reached you
A quiet e-transfer with no paperwork is what causes the delay, not the gift itself

Why the lender asks at all

Two reasons, and neither is about doubting your family.

The first is qualification. If the money has to be repaid, it is a debt, and a debt changes your ratios — sometimes enough to sink the approval. A lender that funds a mortgage on the basis of a gift, and later finds out you owe your parents $600 a month, has been given the wrong file.

The second is anti-money-laundering. Lenders are legally required to know the source of down payment funds. That obligation has been tightened in recent years, and it is applied to everybody, not just to people who look unusual. It is the same reason your own savings need a paper trail.

The part nobody tells you.

The gift letter is the easy part. The proof of source is where files stall. A lender can ask to see the funds in the giver’s account before the transfer — not just landing in yours.

If your parents moved money from an investment account, sold something, or brought funds in from abroad, that trail needs assembling too. It is entirely doable. It is not doable in forty-eight hours.

The target is 90 days of clean history before you apply, and an absolute minimum of 15 days before closing. Season the money early and this whole topic disappears.

What a gift letter has to say

Who is giving, and their relationship to you
The amount
That it is a gift with no expectation of repayment — this is the operative sentence
That the giver is not a party to the purchase and takes no interest in the property
Signatures from the giver and from you

Most lenders have their own form. Use theirs, not a template off the internet — the wording matters and a rejected letter costs days.

The thing families get wrong

A gift on paper and a loan in practice is a real problem, and not only for the lender.

I’ve had files where parents said “it’s a gift” to me and “you’ll pay us back when you can” to their child. That is not a gift, and signing a letter saying otherwise is a false declaration on a mortgage application. I won’t submit it.

If it genuinely is a loan, say so. There are ways to structure family help that don’t involve pretending — a smaller gift, a co-signer arrangement, or waiting. The family purchase centre covers the options.

How much can be gifted

There is no cap. The entire down payment can be gifted on most insured and conventional programmes, provided everything else in the file qualifies on its own.

What the gift does not do is fix income. If your income won’t support the payment, a larger gift reduces the mortgage but doesn’t change the ratios enough on its own — and no lender approves a payment you can’t carry.

What to check

Whether your lender’s own gift letter form is required
Whether the giver can evidence the source of the funds, not just the transfer
If funds are coming from outside Canada, how long that will take — assume longer
That the money is in your account, seasoned, well before closing
That everyone involved understands it as a gift, in the same terms

What to do next

Tell me a gift is coming at the first conversation, not at the document stage. It changes nothing about whether you qualify and everything about how smoothly you close.

Talk it through →

Related questions

Answered by Rajiv Verma, Mortgage Broker · Mortgage Architects — FSRA Brokerage Licence #12728 · Licensed in Ontario · Office 289.505.0631 · Direct 647.291.7116

General educational information only. Individual lender requirements for gifted funds vary and can change. Position stated as at August 2026.