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Can a Parking Ticket Stop You from Buying a Home?

General Ubaid Rehman 4 Apr

Yes—Here’s How!

Unpaid parking tickets might seem like a small issue, but they can impact your chances of qualifying for a mortgage, especially if left unresolved for too long.

Here’s how:

They Can Show Up on Your Credit Report (Indirectly)

While a single unpaid parking ticket won’t directly lower your credit score, if it’s sent to collections, it can appear on your credit report as a collection item.

  • This hurts your credit score, which lenders heavily rely on for mortgage qualification.
  • A lower credit score can lead to higher interest rates or even mortgage denial.

Collections Show Financial Negligence

Lenders look at your financial habits. A small collection—even for a parking ticket—can be seen as a sign of poor financial management.

  • It may raise red flags about your ability to manage regular mortgage payments.
  • It could trigger more scrutiny from the lender, delaying your approval or requiring extra documentation.

It Can Also Disrupt CMHC or Default Insurance Approvals

If you’re applying for a high-ratio mortgage (with less than 20% down), your mortgage needs to be insured (e.g., by CMHC, Sagen, or Canada Guaranty).

  • These insurers also assess your credit and collections.
  • An active collection—even from something minor—can result in denial of default insurance, which means no mortgage approval.

Some Municipalities Can Take Legal Action

  • Unpaid fines may lead to wage garnishment, car registration holds, or even liens, which lenders consider a serious liability.

What You Should Do

  • Check your credit report for any collections—even small ones.
  • Pay off unpaid tickets before applying for a mortgage.
  • Obtain documentation proving payment if a collection was removed or resolved.

Bottom Line:

Don’t let something as small as a parking ticket become a big obstacle in buying your home. Staying on top of even minor debts shows lenders you’re financially responsible and ready for homeownership.

Want help reviewing your credit report before applying for a mortgage? I can help you go over the details and ensure everything’s in shape for approval. Contact us