With housing affordability still a challenge in Toronto, creative ownership structures are becoming more common—especially when a landlord wants to purchase a condo but needs help qualifying for the mortgage.

A scenario we’re seeing more of lately:
A landlord puts up the full down payment, but brings a tenant on title to help qualify for financing.

So how do you divide ownership in a fair and legal way?
Let’s walk through a real-world example and explore a few smart ways to structure the deal.

 

Landlord and tenant shaking hands

🔢 Real-Life Example

  • Purchase price: $500,000

  • Down payment: $60,000 (paid entirely by the landlord)

  • Mortgage required: $440,000

  • Tenant is contributing no cash, but will be added to the mortgage to boost approval odds.

  • Tenant will also live in the condo.

This kind of setup can benefit both parties—but it needs to be structured clearly to avoid future conflicts.

🔄 3 Ways to Structure the Deal

✅ Option 1: Joint Ownership with a Side Agreement (e.g., 50/50 on Title)

Even though the landlord pays the entire down payment, both parties are listed as 50/50 owners.
To protect the landlord’s contribution, a separate legal agreement is drafted stating:

  • The landlord is repaid their $60,000 down payment first when the condo is sold.

  • Remaining profits (if any) are then split 50/50 (or another agreed ratio).

  • The agreement can also outline who pays what monthly and what happens if either party wants out early.

📘 This approach allows shared ownership while protecting the larger investor.

✅ Option 2: Ownership Matches Contribution (e.g., 90/10 Split)

In this setup, the landlord owns 90% and the tenant owns 10%, reflecting the financial input.

  • The tenant helps qualify for the mortgage and lives in the unit.

  • The landlord keeps majority control.

  • Over time, if the tenant contributes to the mortgage or expenses, their share can grow (if agreed in writing).

🧾 This approach works well when both parties want ownership, but not equal say or risk.

✅ Option 3: Sole Ownership with Mortgage Support (Bare Trust or Nominee Agreement)

If the landlord doesn’t want to share ownership, the tenant can still be added to the mortgage only.

  • The landlord is the sole legal owner on title.

  • The tenant signs a nominee or bare trust agreement stating they have no ownership interest.

  • The lender still benefits from the tenant’s income to approve the mortgage.

🛡️ This keeps the property 100% in the landlord’s name while still getting mortgage support.

📍Why This Matters in Toronto

Toronto’s condo prices—and mortgage stress tests—can make financing tough, even for strong income earners. Adding a tenant or family member to the deal (with proper legal guidance) is a practical strategy we're seeing more frequently in 2025.

📑 Final Thoughts

No matter which path you take, make sure to:

  • Consult a real estate lawyer

  • Have a clear, written agreement

  • Understand each person’s role, risk, and exit options

These setups can be a win-win when done right—but without clarity, they can lead to real complications.

 

📞 Thinking of structuring a joint condo purchase in Toronto?
We’ve helped investors, landlords, and families navigate these kinds of deals successfully. Contact Team Sachdeva 416-519-3311 to discuss how to structure your next purchase with confidence.