Quick answer: A co-borrower buys the home with your child: you go on the mortgage and the title, and you own a share. A co-signer backs the mortgage so your child can qualify, and may or may not go on title. Either way, you’re responsible for the whole balance, not half. In our Ottawa example, co-signing a $494,000 mortgage cuts what a parent earning $100,000 could borrow for themselves from about $459,000 to about $51,000.
Most parents who help an Ottawa first-time buyer ask what it does for their child. This post looks at the other side: what it does to you, how the two set-ups differ, and how you get off the mortgage later.
What’s the difference between a co-signer and a co-borrower?
The difference is ownership. Both of you sign, and the lender can come to you for the full amount if payments stop. A co-borrower also owns part of the home. A co-signer usually doesn’t, though some lenders want a co-signer on title too.
| Co-borrower | Co-signer | |
|---|---|---|
| Signs the mortgage | Yes | Yes |
| Responsible if payments stop | For the full balance | For the full balance |
| Income and debts count in the application | Yes | Yes |
| On title, owns a share of the home | Yes | Depends on the lender |
| Usual fit | A partner, or a parent who wants a share | A parent who only wants to help them qualify |
The Financial Consumer Agency of Canada says it plainly: a joint borrower, which it says is also called co-signing, becomes “equally responsible for repaying the unpaid balance” (FCAC). There’s no such thing as signing for half.
What does co-signing do to your own borrowing?
The mortgage becomes your debt as well as your child’s. When you next apply for credit, a lender can count its full payment against your income, even if your child has never missed one.
Here’s an example. Your child buys a $500,000 Ottawa home with 5% down. With CMHC’s 4.00% premium added (CMHC), the mortgage is $494,000. At 4.64%, the best insured 5-year fixed we tracked as of November 2, 2026, over 25 years, the payment is $2,773 a month. You earn $100,000 a year, your own home is paid off, and its property tax and heat cost $550 a month.
Using the 44% total debt limit CMHC sets for insured mortgages (CMHC), here’s how much room you’d have left for a new mortgage of your own, such as a refinance to help another child or a cottage, tested at 6.64%:
| Each month | Before co-signing | After co-signing |
|---|---|---|
| Your gross income | $8,333 | $8,333 |
| 44% total debt limit | $3,667 | $3,667 |
| Your own property tax and heat | $550 | $550 |
| Your child’s mortgage payment | $0 | $2,773 |
| Room left for a new payment | $3,117 | $344 |
| Largest new mortgage you’d qualify for (6.64%, 25 years) | about $459,000 | about $51,000 |
Lenders treat a co-signed mortgage in different ways, and some will look at who has actually been making the payments. But plan on the full payment counting. If you expect to borrow in the next few years, do it before you sign, or ask how your own lender would treat the co-signed mortgage.
Does going on title affect the land transfer tax refund?
It can. Ontario refunds up to $4,000 of land transfer tax to a first-time buyer, but the refund is cut to the share owned by people who qualify (Ontario). On a $500,000 home the tax is $6,475. If you’ve owned a home and take a 50% share as a co-borrower, your child’s refund drops from $4,000 to $2,000.
If a lender wants you on title only for the mortgage, Ontario will treat you as holding title in trust for your child, and keep the full refund, as long as you didn’t get a beneficial interest and your child sends evidence, such as a letter from the bank or a trust agreement. The tax is paid at closing and the refund is claimed afterwards, within 18 months. For the rest of the closing bill, see Ottawa closing costs.
How do you come off the mortgage later?
Only with the lender’s approval, and only when your child can qualify alone. That usually means waiting for a raise, a partner’s income or a smaller balance, and then removing you at renewal or in a refinance. If you’re on title, coming off it is a separate legal step for a lawyer.
Agree on the plan before you sign: who makes the payments, what happens if your child sells, and when you expect to come off. If the lender is a bank or another federally regulated lender, you’re entitled to the same statements your child receives (FCAC). Keep receiving them, so a missed payment never surprises you.
When doesn’t this apply?
If your child can qualify alone at a lower price, or with a larger gift toward the down payment, you may not need to sign at all. A gift doesn’t put your name on the mortgage. If you own a share as a co-borrower, ask an accountant how it’s taxed when the home is sold. The example also assumes your own home is paid off. If you still carry a mortgage, the room left after co-signing is smaller, and may be nothing.
What should you do next?
Before anyone signs, run the numbers both ways: what your child qualifies for with your help, and what that leaves you. Send me your income and debts and your child’s, and I’ll show you both sides. Book a 20-minute call with Joshua Tagg.
Frequently asked questions
Is a co-signer responsible for the whole mortgage?
Yes. FCAC says a joint borrower, also called a co-signer, becomes equally responsible for repaying the unpaid balance. If your child stops paying, the lender can ask you for all of it, not half.
Does co-signing a mortgage affect my credit?
It affects your borrowing. The mortgage is your debt too, so a lender can count its full payment when you apply for credit. In our example, co-signing cut what a parent earning $100,000 could borrow for themselves from about $459,000 to about $51,000.
Do I have to go on title if I co-sign?
It depends on the lender. A co-borrower is always on title and owns a share. Some lenders also want a co-signer on title. If you’re on title only for the mortgage, Ontario can treat you as a trustee for your child for the land transfer tax refund, with evidence.
Will my child lose the land transfer tax refund if I’m on title?
If you’ve owned a home and take a real share, the refund is cut to your child’s share: half of $4,000 on a 50/50 split. If you’re on title only in trust, with a letter from the bank or a trust agreement, your child can claim the full refund.
How do I get off my child’s mortgage?
The lender has to approve it, and your child has to qualify alone. That’s usually done at renewal or through a refinance. Coming off title is a separate step with a lawyer.
This is commentary, not legal, tax or financial advice. Figures as of November 2, 2026. Rates change daily. All mortgages are subject to lender and insurer approval. Joshua Tagg, Indi Mortgage.
