Financing Condition
Learn what a financing condition is in Canadian real estate, how it protects buyers, and why it’s important when making offers on property.
May 22, 2025
What is a Financing Condition?
A financing condition is a clause in a real estate purchase agreement that makes the offer contingent on the buyer securing mortgage approval within a set timeframe.
Why Financing Conditions Matter in Real Estate
In Canadian real estate, the financing condition protects buyers by giving them time—usually 3 to 5 business days—to obtain a mortgage commitment without risking their deposit.If financing is not secured:
- The buyer can back out with no penalty
- The deposit is refunded in full
Understanding the financing condition ensures buyers make informed decisions about risk tolerance, offer strength, and financial readiness.
Example of Financing Condition
A buyer includes a five-day financing condition in their offer, allowing time to receive final approval before committing to the purchase.
Key Takeaways
- Gives buyers time to secure financing.
- Allows withdrawal without penalty.
- Standard in most residential deals.
- Waiving increases risk.
- Part of offer negotiation strategy.
Related Terms
- Conditional Offer
- Firm Offer
- Mortgage Pre-Approval
- Buyer Risk
- Deposit

7211 Greenford Avenue in Burnaby. (Arcadis, OpenForm Properties)
The phasing and overview of the proposal for 7211 Greenford Avenue. (Arcadis, OpenForm Properties)
Renderings of the proposal for 7211 Greenford Avenue in Burnaby. (Arcadis, OpenForm Properties)
Renderings of the low-rise building planned for 7211 Greenford Avenue in Burnaby. (Arcadis, OpenForm Properties)







Yardi
Yardi
Canada residential unit sales by month, actual, 2019 and 2024-2026. Data through June 2026. Source:
Canada residential sales-to-new-listings ratio, actual, January 2025 to June 2026. Source:
Canada residential months of inventory, actual, January 2025 to June 2026. Source: Source:
Year-over-year change in residential average sale price for Canada, Ontario, British Columbia and Alberta, January 2022 to June 2026. Average price is shown here as a regional mix measure, not a substitute for HPI or local comparable sales. Source:
Year-over-year change in residential unit sales for Canada, Ontario, British Columbia and Alberta, January 2024 to June 2026. Source: 
15284-15296 Fleetwood Drive in Surrey. (Flat Architecture, 1098261 BC Ltd.)
Renderings of the tower proposed for 15284-15296 Fleetwood Drive in Surrey. (Flat Architecture, 1098261 BC Ltd.)

Goldberg Group 
10-storey apartment building currently occupying 525 Eglinton Avenue East/WND Associates
Rendering of 525 Eglinton Avenue East/Wallman Architects
The Mayfair West site and its surrounding context. (Grosvenor, Arcadis, Hariri Pontarini Architects)
Renderings of Mayfair West. (Grosvenor, Arcadis, Hariri Pontarini Architects)