Udaibir Singh Kahlon · Submortgage Broker, BCFSA licensed 250 328 5772 udai@kahlonmortgages.com
Udai Kahlon Mortgage Broker · Kelowna BC Apply now
New to Canada

New to Canada mortgages

Arriving in Canada and buying here sooner than people expect is entirely normal — the programs are built for it. Two questions decide a newcomer file: what your status allows you to buy, and how your creditworthiness gets established when the Canadian credit bureaus have barely met you. Both have clear answers, and neither requires you to wait years.

You may qualify far sooner than you think

There is no minimum residency period for CMHC's newcomer program — no requirement to have been here two years, or one, before you can be insured (CMHC). Permanent residents and work permit holders both have a path. What differs between them is the range of properties available and a few conditions along the way.

What your status allows

Permanent residents are treated essentially as any other buyer. Up to 95% financing on a one- or two-unit owner-occupied home, up to 90% on a three- or four-unit owner-occupied property, and up to 80% on a two- to four-unit rental, with the property under $1,500,000 in lending value.

Work permit holders need to be legally authorized to work in Canada, and the insured financing covers one- to four-unit properties with at least one unit owner-occupied. Sagen's New to Canada program takes the same view — a valid work permit or permanent residency, with up to 95% financing on one to two units and 90% on three to four (Sagen).

One thing to check early if you are not yet a permanent resident: the federal Prohibition on the Purchase of Residential Property by Non-Canadians Act runs until 1 January 2027 and applies inside census metropolitan areas — which includes Kelowna. Work permit holders are exempt where the permit has at least 183 days of validity remaining at the time of purchase and they have not already bought during the prohibition. Students, refugees and several other groups have their own exemptions (CMHC). Permanent residents and citizens are outside it entirely. This is worth confirming before you write an offer rather than after — it takes one conversation.

Credit, when your Canadian file is thin

This is the part that worries people most, and it has the most workable answer. The baseline is that at least one borrower or guarantor needs a credit score of 600. Where a Canadian history is limited, CMHC will consider an international credit report, a letter of reference from your bank in your country of origin, or other alternative methods of establishing creditworthiness.

Sagen sets out a similar list in more detail: international credit bureau reports, twelve months of bank or billing statements showing consistent payments, letters of reference from recognised financial institutions, or six months of primary account statements at 90% financing or below.

In practice that means the record you built before you arrived still counts for something. It is worth gathering those documents early — a reference letter from an overseas bank can take weeks to arrive, and it is far easier to request it before you are under contract.

Down payment and the price ceilings

The minimums are the same as for any first purchase: 5% of the first $500,000 of the purchase price and 10% of anything above that, on a one- or two-unit home you will live in. The insured ceiling is a property value below $1,500,000. Sagen's program is a useful illustration of how the ceilings interact — under its rules, financing above 80% requires the property to be under $1,500,000, while at 80% or below the limit is $1,000,000.

Amortization is normally capped at 25 years on insured financing, with up to 30 years available where the buyer is a first-time buyer or the property is new construction. Many newcomers meet the first-time buyer test without realising it.

Two practical notes. Down payment funds arriving from outside Canada are entirely acceptable, but lenders will want to see a clear paper trail of where the money came from — start collecting statements early. And gifted down payments from family are common and well handled, provided the gift is documented properly.

Accounts worth opening the day you decide to buy

The First Home Savings Account is open to anyone who is a resident of Canada, at least 18, and has not owned a home they lived in during the current year or the previous four — the CRA's test is residency in Canada rather than a particular immigration status (CRA). Newcomers frequently qualify and rarely hear about it. There is more on the FHSA, the Home Buyers' Plan and the BC Property Transfer Tax exemptions on the first-time buyers page.

How I work a newcomer file

The first thing I do is match the file to a lender whose newcomer policy fits your particular situation — the documents accepted in place of a Canadian credit history vary meaningfully between lenders, and so does the treatment of income earned recently or partly abroad. Getting that choice right at the start is worth more than anything that happens later. With 50+ lenders available, there is usually one whose guidelines fit yours well.

Then it is the ordinary work: what you comfortably qualify for, what the payments look like, and what to have ready before you start viewing. There is no cost to you on conventional mortgages, and no credit check needed just to talk it through.

Common questions

The things people ask me most.

How long do I need to have lived in Canada before I can get a mortgage?

There is no minimum residency period under CMHC's newcomer program. Permanent residents and work permit holders both have a path to insured financing, and many people buy within their first year here.

Can I buy a home on a work permit?

Yes. You need to be legally authorized to work in Canada, and insured financing covers one- to four-unit properties with at least one unit owner-occupied. Separately, the federal prohibition on purchases by non-Canadians runs until 1 January 2027 and applies in census metropolitan areas including Kelowna — work permit holders are exempt where at least 183 days of validity remain on the permit and they have not already purchased during the prohibition. Worth confirming for your specific situation before you make an offer.

I don't have a Canadian credit history yet. Is that a problem?

It is a well-trodden path. The baseline is a credit score of 600 for at least one borrower or guarantor, and where the Canadian file is limited, an international credit report, a letter of reference from your bank abroad, or twelve months of bank and billing statements showing consistent payments can be used to establish creditworthiness. Gather those documents early — an overseas reference letter can take weeks.

How much down payment do I need?

The same minimums as any first purchase: 5% of the first $500,000 of the price and 10% of the portion above that, on a home you will live in. The insured ceiling is a property value below $1,500,000.

Can my down payment come from outside Canada?

Yes. What matters is the paper trail — lenders will want to see clearly where the funds came from and follow them into your Canadian account. Start saving statements as soon as you begin planning, since reconstructing that history later is the slow part.

Can I open an FHSA if I'm not a permanent resident?

The CRA's conditions are that you are a resident of Canada, at least 18 (19 in some provinces), and have not owned a home you lived in during the current year or the previous four — the test is residency rather than a particular immigration status. A lot of newcomers qualify and never hear about the account, which is a shame given what it does for a down payment.

How long can I amortize the mortgage over?

25 years is the standard maximum on insured financing, and up to 30 years is available where you are a first-time buyer or the home is new construction. Many newcomers meet the first-time buyer test.

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