- TDS
- High-Ratio Mortgage
- Leverage
- Multifamily
- Land Transfer Tax
- 100% Financing
- Insured Mortgage semanticThemes:
- alternative down payment sourcing
- first-time buyer financing
- credit score optimization
- government-backed mortgage programs
- overcoming financial barriers to homeownership enrichedAt: ‘2026-02-07T21:38:00.619Z’
In the ever-evolving Canadian real estate landscape, first-time home buyers face a familiar hurdle: scraping together a down payment. But what if you could bypass that barrier entirely? On the latest episode of the Close More Deals podcast, host Scott Dillingham breaks down innovative strategies to qualify buyers without traditional savings. Drawing from his lending expertise, Dillingham spotlights government-backed programs like CMHC FlexDown, RSP loans, and cash-back mortgage rebates, all tailored for those with a solid 700 credit score. Whether you’re prospecting in Windsor or navigating Ontario home buying hacks, these tips make affordable housing accessible.
This blog post recaps Dillingham’s episode, “Unlocking Opportunities for Buyers Without Down Payments,” while weaving in fresh 2026 updates on flexible down payment programs, debt ratio borrowing, and insured mortgage cash back. If you’re a first-time buyer eyeing no-down-payment mortgages or a real estate pro seeking prospecting strategies, read on for actionable advice to close deals faster. Let’s dive into how you can borrow your down payment and step into homeownership today.
Qualifying Buyers Without Down Payments
Prospecting in Canada’s real estate market demands resilience. As Dillingham notes in the podcast’s opening, “Getting out there, prospecting, doing all those things—it’s a lot of hard work.” Buyers often shut down conversations with “I don’t have a down payment,” but savvy agents and lenders flip the script by educating on viable paths forward.
The key? Shift focus from barriers to solutions. For homes under $500,000, the minimum down payment remains 5%, but programs like CMHC Purchase allow flexible sourcing of those funds. This means borrowing from lines of credit, family, or even credit cards—without derailing your deal. Dillingham stresses that strong buyers (think stable income and good credit) can qualify immediately, turning “no” into “yes” in one call.
Real estate prospecting strategies for no-down-payment buyers in 2026 emphasize empathy and education. Start by asking about their Credit Score early—it’s a gateway question that uncovers hidden opportunities. In Ontario, where home prices hover around $800,000 in major cities, these tactics are gold for agents targeting millennials and Gen Z entrants. By arming clients with knowledge, you build trust and position yourself as the go-to expert.
Understanding Credit Scores: Tips for a 700+ Score in Canada
Credit isn’t just a number—it’s your ticket to flexible financing. Dillingham kicks off the credit discussion at the 0:14 mark: “If [their score] is 700 or higher, then they can potentially tap into one of these two programs.”
A 700 credit score unlocks premium options, signaling low risk to lenders. Here’s how to leverage it:
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Boost Quickly if Needed: Pull free reports from Equifax and TransUnion to fix errors. Lower Credit Utilization below 30% by paying down cards—gains can show in 30 days. Learn more about how to build and improve your credit score fast.
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Ontario-Specific Hacks: With land transfer tax rebates up to $4,000 for first-timers, pair your score with pre-approval to lock rates for 120 days.
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Debt Ratio Impact: Lenders cap total debt at 44% of income (GDS/TDS ratios). Borrowing for down payments factors in minimum payments, but a high score keeps rates low.
For Windsor buyers, LendCity pre-approval shines here. Their streamlined process evaluates 700+ scores for flexible down payment programs, often within 24 hours. Pro tip: Avoid new inquiries pre-application to protect your score.
If your credit score is at 700 or higher but you don’t have traditional savings, you may have more options than you think — book a free strategy call with LendCity to find out which programs fit your situation.
Exploring CMHC FlexDown: Borrow Your Down Payment Effortlessly
Enter CMHC’s FlexDown program—the star of Dillingham’s episode. At 0:11, he explains: “The first program is… called FlexDown. What it does, it’s flexible down payment… They can borrow their down payment… and we’re good to go.”
FlexDown lets qualified buyers source 5-9.99% down from unsecured loans, with property values up to $1.5 million eligible (5% on the first $500K, 10% thereafter). Eligibility requires a strong credit profile (700+), stable income, and no recent bankruptcies. Non-residing family co-borrowers are okay if immediate relatives.
How it works:
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Borrow 5% via line of credit or card.
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Factor minimum payments into debt ratios (e.g., $100/month on a $5,000 loan).
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Secure an insured mortgage—CMHC covers lenders up to 95% LTV.
Sagen FlexDown mirrors this, offering similar perks for 90.01-95% LTV, with premiums as low as 2.8% added to your mortgage. For first-time buyers, it’s a game-changer: No need for gifted funds proof, just transparency on sources.
Cash-Back Mortgage Rebates: Offset Your borrowed down payment
Dillingham’s “little layer” hack? Pair FlexDown with cash-back offers. “We would have the client borrow the 5% down, then… give them the 5% cash back so they could pay off the loan.”
Rebates typically range 1-5%, though they bump rates by 20 basis points per 1% (e.g., +1% for full 5%). Some lenders offer cash-back rebates on new mortgages — check current promotions with your broker. Insured mortgage cash back is ideal for debt ratio borrowing, as rebates can immediately repay the down payment loan.
Ontario home buying hacks amplify this: Combine with the proposed HST rebate (up to $130,000 savings on new builds under $1.5M). Result? You buy now, repay later, and pocket tax breaks.
Deciding between FlexDown for speed or an RSP loan for the tax break comes down to your specific financial picture — book a free strategy call with us and we’ll help you choose the right path.
The RSP Loan Alternative: Tax Benefits with a 90-Day Wait
For a lower-risk route, Dillingham spotlights RSP loans at 1:36: “The client goes to a bank… deposit [into] RRSPs… get a tax break… After 90 days, redeem for the down payment.”
This ties into the Home Buyers’ Plan (HBP), allowing tax-free RRSP withdrawals up to $60,000 ($120,000 for couples) for first-timers, repayable over 15 years. 2025 updates include extended eligibility for recent graduates.
Benefits:
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Tax Refund Boost: Contribute via loan, claim deduction—use refund toward down payment.
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Secured & Easier Approval: Funds stay in-bank, reducing lender risk.
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Downside: 90-day hold vs. FlexDown’s immediacy, plus 10-year repayment in installments.
Ideal for buyers with steady jobs but no savings—perfect for post-school starters Dillingham mentions.
Comparing Loan Options: FlexDown vs. RSP for 2025 Buyers
| Feature | CMHC FlexDown | RSP Loan (HBP) |
|---|---|---|
| Timeline | Immediate | 90 days |
| Down Payment Source | Borrowed (unsecured) | RRSP withdrawal (tax-free) |
| Credit Requirement | 700+ | 700+ |
| Rate Impact | Potential +1% for cash back | Best rates, no cash back needed |
| Repayment | Via minimum payments | 15 years, installments |
| Best For | Urgent buys | Tax-savvy planners |
Real Estate Prospecting Strategies: Targeting No-Down-Payment Leads in Canada
Dillingham’s podcast is prospecting gold. With softening prices and rate drops, focus on:
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Social Proof Scripts: “Even without savings, a 700 score qualifies you for FlexDown—let’s check yours.”
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Local Angles: In Windsor, promote LendCity’s Zero Flex (no down, low FICO).
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Digital Leads: Use LinkedIn for recent grads; email nurtures on HBP tax perks.
These close more deals by empowering buyers.
Ontario Home Buying Hacks 2026: From Pre-Approval to Closing
Ontario’s current scene favors hackers:
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GST/HST Rebate: Up to 100% on new homes under $1.5M for first-timers.
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House Hacking: Buy multi-unit, rent out—covers mortgage via tenants.
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Pre-Approval Power: Locks budgets, shows seller seriousness.
LendCity Pre-Approval: Flexible Down Payment Edge
For Canada locals, LendCity streamlines residential mortgage pre-approvals with no-income-limit Flex programs, accepting lower scores for zero-down scenarios. If you want to explore residential mortgage programs beyond FlexDown and RSP loans, working with a broker who knows all the options can open up additional pathways to homeownership. Pair with Sagen for insured cash back.
Sagen FlexDown Eligibility: Insured Mortgages Made Simple
Sagen’s version requires 5% down (borrowed okay) for ≤$500K homes, with premiums charted by LTV. Strong credit? Debt ratios stay manageable.
Key Takeaways for First-Time Home Buyers in 2026
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Assess credit early—700+ opens doors.
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FlexDown for now; RSP for savings.
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Stack cash back and rebates to neutralize costs.
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Prospect with education: Turn hurdles into wins.
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Ontario perks like HST rebates save thousands.
In Canada, homeownership isn’t a dream—it’s a strategy. Check resources below, get pre-approved, and unlock your future. What’s your first move? Share in comments!
Key Takeaways:
- Qualifying Buyers Without Down Payments
- Understanding Credit Scores: Tips for a 700+ Score in Canada
- Exploring CMHC FlexDown: Borrow Your Down Payment Effortlessly
- Cash-Back Mortgage Rebates: Offset Your borrowed down payment
- The RSP Loan Alternative: Tax Benefits with a 90-Day Wait
Frequently Asked Questions
Can I buy a home in Canada without a down payment in 2026?
What credit score do I need to qualify for CMHC FlexDown?
How does the RSP loan strategy work for first-time home buyers?
What is the difference between FlexDown and RSP loans for down payments?
Can I get cash back on my mortgage to pay off my borrowed down payment?
What debt ratios do lenders allow when borrowing a down payment?
Are there any Ontario-specific benefits for first-time home buyers?
How quickly can I get pre-approved using a flexible down payment program?
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Consult a licensed mortgage professional before making any financing decisions.
Written by
LendCity
Published
December 18, 2025
· Updated February 12, 2026Reading time
9 min read
CMHC Insurance
Mortgage default insurance from Canada Mortgage and Housing Corporation. For 1-4 unit investment properties, investors must put 20%+ down (no insurance available). However, CMHC offers MLI Select for 5+ unit multifamily properties, and house hackers can access insured mortgages with 5-10% down.
Credit Score
A numerical rating (300-900 in Canada) that represents your creditworthiness, affecting mortgage rates and approval. 680+ is typically needed for best rates.
Credit Utilization
The percentage of your available credit that you're using. Keeping this under 30% helps maintain a healthy credit score.
Down Payment
The upfront cash payment when purchasing a property. For 1-4 unit investment properties, minimum 20% down is required. 5+ unit multifamily can use CMHC MLI Select with lower down payments, and house hackers can put as little as 5% down on owner-occupied 2-4 plexes. Your down payment directly affects your [LTV](/glossary/ltv) and the amount of [leverage](/glossary/leverage) you use.
GDS
Gross Debt Service ratio - the percentage of gross income needed to cover housing costs (mortgage, taxes, heating). Maximum typically 39%. For investors, rental income from the property can offset these costs through rental offset calculations. See also [TDS](/glossary/tds) and [Mortgage Stress Test](/glossary/mortgage-stress-test).
House Hacking
Living in one unit of a multi-unit property while renting out the others to offset your mortgage payments and living expenses.
Interest Rate
The cost of borrowing money, expressed as a percentage. It determines how much you pay on top of the principal borrowed. Interest rates directly affect monthly payments, [cash flow](/glossary/cash-flow), and [DSCR](/glossary/dscr). See also [Amortization](/glossary/amortization).
LTV
Loan-to-Value ratio - the mortgage amount expressed as a percentage of the property's appraised value or purchase price (whichever is lower). An 80% LTV means you're borrowing 80% and putting 20% [down](/glossary/down-payment). Lower LTV generally means better [interest rates](/glossary/interest-rate) and terms. See also [Equity](/glossary/equity) and [Leverage](/glossary/leverage).
Market Value
The estimated price a property would sell for on the open market under normal conditions. Determined by comparable sales, location, condition, and market demand.
Mortgage Broker
A licensed professional who shops multiple lenders to find the best mortgage rates and terms for borrowers. Unlike banks, brokers have access to dozens of lending options.
Pre-Approval
A conditional commitment from a lender stating your borrowing capacity, valid for 90-120 days. For investors, getting pre-approved helps you move quickly on deals and shows sellers you're a serious buyer with financing in place.
Hover over terms to see definitions. View the full glossary for all terms.