Don’t Sign That Lease for Another Year - Let’s Explore Your Options for Buying a Home Instead!

October 13, 2026 | Posted by: Patricia McKean - Cochrane and Airdrie Mortgage Broker

Your lease renewal is sitting on the kitchen counter. Your landlord may be increasing the rent, and you're wondering whether you should just sign for another year.

But before you do, let's have a conversation about something you might not have considered seriously yet.

What if you're closer to buying your first home than you think?

We understand. Buying a home can feel overwhelming, especially when you've been told you need a huge down payment, perfect credit, or a six-figure income just to get started.

Our mortgage team helps renters throughout Calgary, Airdrie, Cochrane, Red Deer, Carstairs, Olds, Rocky View County, and Mountain View County explore their options, understand their budgets, and make confident decisions about homeownership.

We've worked with people who assumed buying was years away, only to discover there were options they hadn't considered.

We're not suggesting everyone should rush out and buy a house tomorrow. But we are suggesting that before you commit to another 12 months of rent, you owe it to yourself to find out what's possible.

Myth #1: "I Need 20% Down to Buy a House"

This is probably one of the most common misconceptions we hear.

You do not necessarily need 20% down to purchase a home in Canada.

For eligible buyers, the minimum down payment can be as low as 5%.

Here's how Canada's minimum down payment requirements generally work:

A home priced at $300,000 may require just $15,000 down
A home priced at $400,000 may require $20,000 down
A home priced at $500,000 may require $25,000 down
A home priced at $600,000 may require $35,000 down

For homes priced over $500,000 but under $1.5 million, the minimum is generally 5% on the first $500,000 and 10% on the portion above that. Homes priced at $1.5 million or more generally require at least 20% down.

When you're putting less than 20% down, mortgage default insurance is typically required. This adds to your borrowing costs, so we include it in your numbers from the beginning.

Of course, minimum down payment doesn't mean automatic approval. Your income, debts, credit history, property, and available funds all matter.

But there's a big difference between thinking you need $80,000 to buy a $400,000 home and discovering that you may qualify with $20,000 down.

That's worth exploring before signing another lease.

Myth #2: "I Don't Have Enough Saved, So Buying Isn't an Option"

This is where a little mortgage planning can change the conversation.

There are several ways to put together a down payment, and not all of them involve saving every dollar yourself.

Gifted Down Payments

Did you know that an eligible family member may be able to gift you some or all of your down payment?

For example, let's say you've saved $10,000, and a parent wants to help you with another $10,000.

You may now have the $20,000 needed for a 5% down payment on a $400,000 home.

A genuine gifted down payment generally doesn't need to be repaid. Lenders require documentation confirming the gift and the source of funds.

We can help you understand which family relationships and gift arrangements are acceptable to the lender and mortgage insurer.

Flex Down: Borrowed Down Payment Programs

Here's another option many renters have never heard about.

Some lenders and mortgage insurers offer borrowed down payment programs, sometimes called Flex Down.

Under an eligible program, you may be able to use funds from an approved personal loan or line of credit toward your down payment.

That doesn't mean free money or an easy shortcut.

The borrowed funds must meet program requirements, and the new loan payment counts toward your total debt obligations. You still need suitable credit, enough income, and room in your budget for both payments.

For the right borrower, it's an option worth evaluating.

For someone already carrying significant debt, however, borrowing the down payment may not be the right move.

Our job is to work through those numbers with you before recommending anything.

First Home Savings Account (FHSA)

If you're an eligible first-time buyer, the First Home Savings Account can be a valuable tool.

It allows qualifying contributions to be tax-deductible, while eligible withdrawals for your first home can be tax-free.

Even if buying isn't quite possible today, we can help you understand how an FHSA may fit into a longer-term down payment plan.

RRSP Home Buyers' Plan

Eligible buyers may also be able to withdraw funds from an RRSP through the federal Home Buyers' Plan.

There are withdrawal limits, eligibility rules, and repayment requirements, so we need to understand your personal situation before deciding whether this makes sense.

The important point is this: don't assume your savings account balance tells the whole story.

There may be more than one path to putting your down payment together.

Myth #3: "My Credit Has to Be Perfect"

Perfect credit isn't a requirement for every mortgage.

We work with people who have experienced missed payments, higher credit card balances, separations, employment changes, and other financial setbacks.

Not everyone will qualify immediately. Sometimes we need to build a plan over the next six or twelve months.

That plan might involve paying down one credit card, correcting a credit report error, or improving how existing debts are managed.

The point is to understand where you stand rather than assume the answer is no.

Myth #4: "My Rent Is Affordable, So Buying Must Be More Expensive"

Not necessarily. But we need to compare the full costs, not just the mortgage payment.

Let's say you're renting a home in Airdrie, Calgary, or Red Deer for $2,200 per month.

Over five years, assuming rent stays the same, that's:

$2,200 × 12 months = $26,400 per year
$26,400 × 5 years = $132,000 in rent

Rent provides a place to live, flexibility, and freedom from many of the repair costs that come with ownership. Those are real benefits.

But rent payments don't build ownership equity in the property.

When you own a home, a portion of each mortgage payment goes toward reducing your mortgage balance.

Over time, that can become a valuable asset.

Case Study: What If You Bought a $400,000 Home Instead?

Imagine a first-time buyer who is currently paying $2,200 per month in rent.

They find a suitable home priced at $400,000 and qualify for financing with a 5% down payment.

For this illustration, we'll use a hypothetical 4.5% mortgage rate, a 25-year amortization, and standard mortgage default insurance.

These are examples, not a current rate quote or a mortgage approval.

The Purchase

Home purchase price: $400,000
5% down payment: $20,000
Base mortgage: $380,000
Illustrative mortgage insurance premium: $15,200
Total starting mortgage: $395,200
Estimated monthly mortgage payment: approximately $2,190

That monthly mortgage payment is close to the $2,200 rent in our example.

But here's where we need to be careful.

Owning also means budgeting for property taxes, insurance, maintenance, utilities, and potentially condo fees. There will also be upfront closing costs.

So we're not going to tell you that a $2,190 mortgage payment is the same as $2,200 rent.

It isn't.

Where Things Get Interesting: Building Equity

With this example, after five years of regular mortgage payments, approximately $48,000 of the original mortgage balance would have been paid off.

Now imagine two possibilities.

Scenario A: The Property Value Stays the Same

After five years:

Estimated property value: $400,000
Estimated mortgage remaining: $347,000
Estimated home equity: $53,000

That's equity built through your down payment and repayment of the mortgage, after accounting for the financed mortgage insurance premium.

Scenario B: The Property Increases in Value by 2% Per Year

If the property appreciates by an average of 2% annually, its estimated value after five years would be approximately $441,600.

Estimated mortgage remaining: $347,000
Estimated home equity: $94,600

That's a significant difference.

But appreciation is never guaranteed. Home values can remain flat or decline, and selling would involve costs such as real estate commissions and legal fees. Mortgage penalties may also apply.

These scenarios aren't promises of future equity. They simply show how mortgage repayment and possible appreciation work together.

When you rent, you pay for housing. When you own, you're also gradually paying down a mortgage on an asset that belongs to you.

The question is whether ownership makes financial sense for your circumstances and how long you expect to stay.

Myth #5: "I Don't Even Know What Price Range I Could Afford"

This is actually one of the best reasons to talk with us.

You don't need to start by looking at houses.

You need to start with a budget.

And we don't mean the absolute maximum mortgage a lender might approve.

We mean a realistic, comfortable monthly budget that still allows you to live your life.

Maybe you enjoy travelling, have children in sports, commute between communities, or want to keep building your savings.

Those things matter.

Here's How We Help Build Your Homeownership Budget

We sit down and look at:

Your household income and how consistent it is
Your current rent and monthly living expenses
Credit cards, vehicle payments, and other debt obligations
The down payment you have or could potentially access
Your expected property taxes, utilities, and insurance
Maintenance, emergency savings, and other ownership costs
A purchase price and monthly payment you can comfortably manage

We also account for the mortgage qualification rules, including the applicable stress test.

Sometimes the numbers show that buying now is realistic.

Sometimes they show that you're better off preparing for another six or twelve months.

Either answer is useful because now you have a plan instead of a guess.

You Don't Have to Figure Out the Real Estate Side Alone, Either

Once we understand what you can comfortably afford, we can connect you with trusted REALTOR® professionals who understand the communities you're considering.

Whether you're looking for a starter home in Airdrie, a townhome in Cochrane, a property in Calgary, or something in Carstairs, Olds, or Red Deer, having the right professionals working together makes a difference.

Rural properties in Rocky View County and Mountain View County can come with additional financing considerations, particularly around acreage, outbuildings, property use, water, and septic systems.

Those are things we want to review before you fall in love with a property.

We help you understand the financing side, while your REALTOR® helps you explore suitable properties, market conditions, and purchase negotiations.

You don't have to start with a house.

You can start with a conversation.

Myth #6: "If I Can't Buy Right Now, There's No Point in Talking to a Mortgage Professional"

We actually think the opposite.

Some of the most valuable conversations we have are with people who aren't quite ready to buy.

Maybe you need another $5,000 saved.

Maybe one vehicle loan is affecting your qualifying amount.

Maybe you're self-employed and need help understanding how your income will be reviewed.

Or maybe you're closer than you think.

If we have time to plan, we can often identify practical steps that put you in a stronger position when you're ready.

Even if you ultimately decide to renew your lease, you'll be doing it with a clearer understanding of your options.

Mortgage Glossary: Terms Every First-Time Buyer Should Know

Down Payment - The money you contribute toward the purchase price of your home.
Mortgage Default Insurance - Insurance generally required when your down payment is less than 20%. It protects the lender, not the borrower.
Equity - The difference between your home's current market value and the amount you owe against it.
Amortization - The total period used to calculate repayment of your mortgage, assuming scheduled payments continue.
Pre-Approval - A lender's preliminary assessment of how much you may be able to borrow, subject to conditions and final approval.
Gifted Down Payment - Eligible funds provided as a genuine, non-repayable gift to help purchase a property.
Flex Down - A mortgage program that may permit qualifying borrowed funds to be used for a down payment.
Mortgage Stress Test - A calculation lenders use to assess whether you can afford payments at a qualifying interest rate, which can be higher than your actual contract rate.
Closing Costs - Additional expenses associated with completing a home purchase, such as legal fees, adjustments, and inspections.

Frequently Asked Questions

Can I buy a home in Alberta with only 5% down?
Yes, eligible buyers can purchase qualifying homes priced at $500,000 or less with a minimum 5% down payment. Higher purchase prices have different minimum down payment calculations. Mortgage approval and insurance requirements still apply.

Can my parents give me money for a down payment?
Yes. A properly documented, non-repayable gift from an eligible family member may be accepted. We can help review the requirements before money changes hands.

Can I borrow money for my down payment?
Potentially. Certain borrowed down payment programs accept eligible loan or line-of-credit funds. The additional debt payment must fit within lender and insurer qualification requirements.

Is it better to rent or buy in Calgary, Airdrie, Cochrane, or Red Deer?
That depends on your budget, how long you plan to stay, available savings, and the ownership costs of the property. We can compare your numbers so the decision is based on more than the monthly mortgage payment.

What if I have debt or less-than-perfect credit?
You may still have options, depending on your full financial picture. If you're not ready today, we can help identify what needs to improve and develop a realistic plan.

Should I get mortgage pre-approved before contacting a REALTOR®?
It's a smart place to start. Understanding your financing and comfortable price range before shopping can save time and help you make better decisions. A pre-approval is not a guarantee of final financing.

Before You Sign Another Lease, Let's Talk

You don't have to know exactly what you want to buy.

You don't need to have every financial detail figured out.

And you certainly don't need to assume homeownership is out of reach just because someone told you that you need 20% down.

We can help you explore down payment options, build a practical homeownership budget, understand your mortgage qualification, and connect with trusted real estate professionals when you're ready.

Whether you're renting in Calgary, Airdrie, Cochrane, Red Deer, Carstairs, Olds, Rocky View County, or Mountain View County, we're here to help you explore what's possible.

Maybe this is the year you purchase your first home.

Maybe this is the year you make a plan to get there.

Either way, wouldn't it be better to know before you sign another lease?

Let's explore your options together. Reach out for a mortgage conversation before committing to another year of renting.

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Patricia McKean | Airdrie - Cochrane- Calgary Mortgage Broker

Mortgage Blog

Your Trusted Airdrie and Cochrane Mortgage Planner

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