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Get My Free Estimate →Permanent residents can buy freely; work permit holders and students face the federal foreign buyer ban, which runs to 1 January 2027, not 2025. On financing, CMHC publishes real criteria: permanent resident status or legal authorisation to work, no minimum period of residency, minimum equity of 5 per cent of the first $500,000, and a minimum credit score of 600 for at least one borrower. Where there is no Canadian credit file, CMHC accepts an international credit report, a reference letter from your bank in your country of origin, or twelve months of documented rent payments plus one other obligation. Almost everything else on the usual newcomer checklist is lender practice, not regulation.
This page is about rules and process only. It does not discuss where to live, what any area is like, or who lives in it, and it never will. Under RECO’s rules and the Ontario Human Rights Code, steering a buyer toward or away from a neighbourhood on that basis is prohibited, and rightly so. What follows is the documentation and qualification side, which is where the actual difficulty is.
First: check whether you are allowed to buy at all
The federal foreign buyer ban is still in force. The Prohibition on the Purchase of Residential Property by Non-Canadians Act came into force on 1 January 2023 and, following an amendment in the Budget Implementation Act, 2024, is now repealed on the fourth anniversary of that date — 1 January 2027. A great deal of published material, including pages on federal agency websites, still describes it as a two-year ban expiring on 1 January 2025. That is out of date. Check the Justice Laws consolidation, which is linked in the sources.
| Who | Position under the Act |
|---|---|
| Canadian citizen | Not caught. |
| Permanent resident | Not caught. A permanent resident is expressly outside the definition of “non-Canadian”. |
| Person registered as an Indian under the Indian Act | Not caught. |
| Work permit holder | Caught, unless an exception applies. The main one requires 183 days or more of validity remaining on the work permit at the date of purchase, and that you have not already purchased more than one residential property. |
| International student | Caught, unless a narrow exception applies. It requires enrolment at a designated learning institution, tax returns filed for each of the five preceding taxation years, physical presence in Canada of at least 244 days in each of the five preceding calendar years, a purchase price not exceeding $500,000, and no more than one property purchased. In practice this is very hard to meet. |
| Protected person or refugee claimant referred to the Refugee Protection Division | Exempt. |
| Buying with a Canadian spouse or common-law partner who is a citizen, permanent resident, registered Indian, or an exempt temporary resident | Exempt. |
Two further points that surprise people. The Act only covers buildings with not more than three dwelling units, plus semi-detached houses, rowhouse units and condominium units. And property outside a census metropolitan area or census agglomeration is excluded entirely by regulation — much of rural Ontario is outside the ban.
The penalty provision reaches beyond the buyer. It applies to “every person or entity that counsels, induces, aids or abets” a non-Canadian to purchase knowing they are prohibited — which includes realtors and lawyers. That is a large part of why I check status early rather than late. Note also s. 5: a contravention does not affect the validity of the sale. The deal is not void; the parties are exposed.
Credit history: the honest version
The usual claim is that your credit history does not transfer to Canada. That is no longer strictly true, and the accurate version is more useful.
What Immigration, Refugees and Citizenship Canada says: “banks here may not recognize your credit history from another country.” Note “may not”. Both Canadian credit bureaus now sell products that bring home-country credit data into a Canadian lending decision, and Equifax Canada describes delivering “a credit file with the applicant’s home country credit information appended with Canadian credit information… in real time”.
So: whether your foreign credit history counts is lender practice, not a rule. It is a question to ask a specific lender, and the answer varies. Plan to build Canadian credit regardless, because you cannot control which lender you end up needing.
What CMHC actually publishes for newcomers
This is the part that is genuinely regulated rather than a matter of lender preference, and it is more generous than most people expect.
| Requirement | What CMHC states |
|---|---|
| Status | Permanent resident status, or legal authorisation to work in Canada such as a work permit. No minimum period of residency required. |
| Non-permanent residents | Eligible for homeowner (owner-occupied) loans only. And only where the borrower is exempt from the foreign buyer ban. |
| Minimum equity, 1 to 2 units | Up to 95 per cent loan-to-value — minimum 5 per cent of the first $500,000 of lending value and 10 per cent of the remainder. The same table applies to permanent and non-permanent residents. |
| Minimum equity, 3 to 4 units | Up to 90 per cent loan-to-value, minimum 10 per cent equity. |
| Borrowed down payment | Available between 90.01 and 95 per cent loan-to-value on 1 to 2 units, but not for non-permanent residents. |
| Credit score | At least one borrower or guarantor must have a minimum credit score of 600. |
| Price limit | Under $1,000,000 where loan-to-value is 80 per cent or less; under $1,500,000 where it is above 80 per cent. |
| Amortization | 25 years, or 30 years where loan-to-value is above 80 per cent and the borrower is a first-time buyer or is buying a newly built home. |
| Debt service ratios | Gross debt service 39 per cent, total debt service 44 per cent. |
| Qualifying rate | The greater of the contract rate plus two percentage points, or 5.25 per cent. |
A stale CMHC document to avoid. CMHC still hosts a 2016 guide, Buying Your First Home in Canada: What Newcomers Need to Know, which says non-permanent residents need a minimum down payment of 10 per cent. That is superseded — the current 2025 fact sheet puts non-permanent residents on the same 5 per cent-start table as permanent residents for homeowner loans. Several realtor sites still quote the 2016 document.
Establishing creditworthiness without a Canadian credit file
CMHC sets out three routes where there is no sufficient Canadian credit report:
- An international credit report; or
- A letter of reference from the borrower’s financial institution in their country of origin supporting the strength of the borrower and their financial knowledge and experience; or
- Alternative methods — CMHC’s wording: confirmation of payment of rent or room and board, plus one additional financial obligation or documented regular savings, for the preceding 12 months. Where rent confirmation is not available, verification of three other types of obligation over the preceding 12 months, such as utilities, cable, childcare expenses, insurance premiums, or documented regular savings.
Read route three again, because it is the practical one. Twelve months of documented rent payments plus one other obligation can establish creditworthiness for an insured mortgage. If you are renting now and intending to buy, start keeping that record today — receipts, bank transfers, a letter from the landlord. It is worth more than most people realise.
Building Canadian credit from zero
The Financial Consumer Agency of Canada names secured credit cards specifically for this. Its wording: “You may want to consider a secured credit card if you are a newcomer to Canada and have no credit history”. A security deposit is required, and the limit is normally set at or above the deposit.
You also have a right to a bank account. FCAC: you may be able to open a personal bank account with proper identification even if you are not a Canadian citizen, even if you have no job, and even if you have no money to deposit right away. Two pieces of identification from a reliable source are required, and the accepted list expressly includes foreign passports. The grounds on which a bank may refuse are a closed list — fraud, illegal purposes, false statements, safety, and failure to allow identity verification. No credit, no job and no deposit are not on that list.
What lenders ask for, and what is actually a rule
You will find newcomer mortgage checklists everywhere: employment letter, three months of pay stubs, a copy of your permanent resident card or work permit, ninety days of seasoning on the down payment, a reference letter from a foreign bank. Almost none of that is regulation. It is lender underwriting practice, and it varies. I am not going to present it to you as a rule, because when you meet a lender who does it differently you will not know which parts were negotiable.
What is published:
- FCAC, generically for all borrowers: lenders ask for identification, proof of employment, and proof you can pay the down payment and closing costs. For employment, proof of current salary or hourly rate such as a recent pay stub, your position and length of time with the employer, and two years of notices of assessment if self-employed.
- OSFI Guideline B-20, binding on federally regulated lenders: “Borrowers relying on income from sources outside of Canada pose a particular challenge for income verification, and lenders should conduct thorough due diligence in this regard.” That is the actual regulatory basis for the extra scrutiny on foreign income.
- The foreign-bank reference letter and international credit report are genuinely published requirements — but as CMHC’s alternative ways to establish creditworthiness for an insured mortgage, not as a universal rule.
- Proof of immigration status has a real legal driver for a non-permanent resident: CMHC insurance requires the borrower to be exempt from the foreign buyer ban, which for a work permit holder means documenting 183 or more days of remaining permit validity.
And then there is the tax
Ontario’s Non-Resident Speculation Tax is 25 per cent and Toronto adds its own 10 per cent municipal version. Permanent residents are outside both. Work permit holders and international students are not. That is covered properly on a separate page, and it is the single largest number in this whole subject.
New to Canada and working out what is possible?
The first two questions are whether the foreign buyer ban applies to you and what your status means for the Non-Resident Speculation Tax. Both have definite answers and both are worth getting before you look at a single property. Send me your situation and I will set out where you stand, and tell you plainly which parts need an immigration lawyer or an accountant instead of me.
connect@jatindua.com · 437-987-1925 · Book a free consultation
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Frequently asked questions
Can a permanent resident buy a home in Canada?
Yes. A permanent resident is expressly outside the definition of “non-Canadian” in the Prohibition on the Purchase of Residential Property by Non-Canadians Act, and permanent residents are also outside Ontario’s Non-Resident Speculation Tax.
Is the foreign buyer ban still in effect?
Yes. It came into force on 1 January 2023 and, following an amendment in the Budget Implementation Act, 2024, is repealed on the fourth anniversary of that date — 1 January 2027. Material describing it as expiring on 1 January 2025 is out of date, including some pages on federal agency websites.
Can I get a mortgage with no Canadian credit history?
CMHC publishes three ways to establish creditworthiness where there is no sufficient Canadian credit report: an international credit report; a letter of reference from your financial institution in your country of origin; or alternative methods, which CMHC describes as twelve months of documented rent or room and board plus one other financial obligation, or three other obligations where rent confirmation is unavailable.
How long do I have to live in Canada before I can buy?
CMHC states there is no minimum period of residency required for its newcomer mortgage loan insurance, for permanent residents and for those with legal authorisation to work.
What down payment does a non-permanent resident need?
On CMHC-insured homeowner loans for one to two units, the same table as permanent residents: up to 95 per cent loan-to-value, with minimum equity of 5 per cent of the first $500,000 of lending value and 10 per cent of the remainder. Note that CMHC’s 2016 newcomer guide, which is still online, says 10 per cent for non-permanent residents. That document is superseded.
Does my credit history from another country count?
It depends on the lender. IRCC states that banks in Canada “may not recognize” credit history from another country. Both Canadian credit bureaus now sell products that bring home-country credit data into a Canadian lending decision, and CMHC accepts an international credit report for insured mortgages. Whether a particular lender uses any of that is practice, not rule.
Can I open a bank account without a credit history?
Yes. The Financial Consumer Agency of Canada states you may open a personal bank account with proper identification even if you are not a Canadian citizen, even without a job, and even without money to deposit. Foreign passports are on the accepted identification list. The grounds for refusal are a closed list and no credit history is not among them.
Related reading
- Non-Resident Speculation Tax: who pays, who is exempt
- Renting now, buying later: the deposit and financing timeline
- New-home HST relief: the eligibility checker
Sources
Every figure on this page traces to one of these, and each was read on 30 August 2026. Primary sources only — statute, regulation, and the government or agency that administers the rule. Where I could not verify something from a primary source, the page says so instead of guessing.
- Mortgage loan insurance for newcomers. Canada Mortgage and Housing Corporation. Permanent residents and legally authorised workers; no minimum period of residency required. Accessed 30 August 2026.
- CMHC Newcomers fact sheet (PDF). Canada Mortgage and Housing Corporation, version 20250827-009A. Sets the loan-to-value table, the minimum credit score of 600, and the alternative ways of establishing creditworthiness. Accessed 30 August 2026.
- Prohibition on the Purchase of Residential Property by Non-Canadians Act, S.C. 2022, c. 10, s. 235. Justice Laws Website. Consolidation current to 21 June 2026; the repeal provision remains under “Amendments Not In Force”. Accessed 30 August 2026.
- Budget Implementation Act, 2024, Part 4, Division 1, s. 149. Justice Laws Website. Replaces the sunset in the Budget Implementation Act, 2022, No. 1 with the fourth anniversary of 1 January 2023 — that is, 1 January 2027. Accessed 30 August 2026.
- Newcomers: buying a home in Canada. Immigration, Refugees and Citizenship Canada. States that banks here “may not recognize your credit history from another country”. Accessed 30 August 2026.
- Choosing a credit card. Financial Consumer Agency of Canada. Names secured credit cards as an option for newcomers with no credit history, and explains the security deposit. Accessed 30 August 2026.
- Opening a bank account. Financial Consumer Agency of Canada. You may open an account even if you are not a Canadian citizen, have no job and no money to deposit. Accessed 30 August 2026.
- Getting preapproved for a mortgage. Financial Consumer Agency of Canada. The general documentation a lender asks for: identification, proof of employment, and proof of the down payment and closing costs. Accessed 30 August 2026.
- Guideline B-20: Residential Mortgage Underwriting Practices and Procedures. Office of the Superintendent of Financial Institutions. Requires thorough due diligence where a borrower relies on income from sources outside Canada. Accessed 30 August 2026.
- Non-Resident Speculation Tax. Ontario Ministry of Finance. Rate of 25 per cent effective 25 October 2022, applying province-wide. Accessed 30 August 2026.
About the author — Jatin Dua, Etobicoke real estate agent
I’m the Broker of Record at RE/MAX Quantum Realty, 799 The Queensway in Etobicoke. I write these pages the same way I work a file: read the primary source, quote it, date it, and say plainly where the source is silent or where two sources disagree. If a figure on this page has no citation beside it, that is a mistake and I want to hear about it.
I work with buyers, sellers, renters and investors across Etobicoke, Mimico, Humber Bay Shores, New Toronto, Long Branch, Alderwood and Stonegate–Queensway. connect@jatindua.com or 437-987-1925.