CMHC mortgage insurance
Putting less than 20% down in Canada? You will pay a default-insurance premium. See how much it adds.
CMHC mortgage insurance calculator
Canada lets you buy with as little as 5% down, but there is a catch: any mortgage with less than 20% down must carry default insurance. The premium protects the lender, not you, and it gets added straight onto your loan - quietly raising both your balance and your payment.
What it costs
The premium is a percentage of your mortgage that climbs as your down payment shrinks: roughly 2.8% with 15 to 19.99% down, 3.1% with 10 to 14.99%, and 4.0% with 5 to 9.99%. The smaller your down payment, the more you borrow and the higher the rate on that larger amount - a double effect worth seeing in dollars before you decide how much to put down.
The minimum down payment rules
You need 5% on the first $500,000 of the price and 10% on the portion above it, up to a $1.5 million ceiling. At or above $1.5 million, insured mortgages are not available and you must put down at least 20%. The calculator checks these rules and tells you if your down payment falls short.
The tax most people miss
While the premium itself is folded into your mortgage, the provincial sales tax on that premium is not - in Ontario, Quebec, Saskatchewan and Manitoba you pay it in cash at closing. It is a small but real surprise, so add it to your closing budget next to your land transfer tax.
Frequently asked questions
What is CMHC insurance?
Mortgage default insurance that protects the lender when you put down less than 20%. It is mandatory on insured mortgages in Canada and is provided by CMHC, Sagen or Canada Guaranty. The premium is added to your mortgage balance, not paid separately each month.
How much is the CMHC premium?
It depends on your loan-to-value: about 2.8% of the loan with 15-19.99% down, 3.1% with 10-14.99% down, and 4.0% with 5-9.99% down. On a $465,000 loan at 4.0% that is roughly $18,600 added to your mortgage.
What is the minimum down payment in Canada?
Five percent on the first $500,000 of the price and ten percent on the portion above $500,000, up to $1.5 million. At $1.5 million or more you need 20% and cannot get an insured mortgage.
Do I pay tax on the CMHC premium?
In Ontario, Quebec, Saskatchewan and Manitoba, provincial sales tax on the premium must be paid in cash at closing - it cannot be added to the loan. Budget for it alongside your other closing costs.
How do I avoid CMHC insurance?
Put down 20% or more. That makes your mortgage conventional, removes the premium entirely, and can save you many thousands of dollars over the life of the loan - though it means a larger upfront down payment.