How deposits work on a new GTA home

A builder deposit is the money you pay the developer on a schedule while the home is being built. Your mortgage down payment is a separate conversation with your lender, closer to closing. People mix the two and then discover the deposit schedule and the bank’s down payment are not the same cheque.

The schedule is project-specific. A common pattern is a portion at signing, more within the first few months, and the balance spread over a year or two. Some releases ask for more, sooner. The total and the dates matter more than a slogan about a low deposit.

Ask for the deposit amount, the dates, and where the money is held. On a condominium, deposits are handled under Ontario’s condominium rules and are generally protected through the prescribed trust arrangements. On a freehold home, Tarion and the purchase agreement govern the structure. Do not assume the condo rule applies to a freehold townhome.

Also ask what happens if you cannot complete. The agreement, not the sales gallery conversation, answers that.

Write the dates and amounts on one page. Then ask whether you can pay them without selling an asset you are not ready to sell, and without assuming a mortgage you have not been qualified for. If the answer is uncomfortable, the project is early to say yes to, even if you like the floor plan.