When your down payment is less than 20% of the price, the mortgage has to be insured against default, and you pay the premium. It’s a one-time charge, a percentage of the loan that depends on how much of the home’s value you borrow, and it’s usually added to the mortgage. This calculator works out the premium and the insured mortgage for your price and down payment; the premium is one of several closing costs of buying with a small down payment.
| Loan-to-value | Down payment | Premium rate | Your premium |
|---|
How the calculator works
It takes the mortgage (price minus down payment), works out the loan-to-value ratio, and applies the premium rate for that ratio from CMHC’s schedule below; the rates come from the same data as the tables on this page. With an amortization longer than 25 years it adds the 30-year surcharge, and it shows the mortgage with the premium added.
It says the mortgage can’t be insured when:
- the price is $1.5 million or more, where the minimum down payment is 20% of the price;
- the down payment is below the minimum for the price, which is set out under minimum down payment below (it shows the minimum for the price you enter);
- the amortization is longer than 30 years.
It can’t tell whether you qualify for an amortization over 25 years, which an insured mortgage can have only for a first-time buyer or a newly built home.
With the starting values, a $500,000 home with $50,000 down: the mortgage is $450,000, which is 90% of the price, so the premium rate is 3.10%. The premium is $13,950 and the insured mortgage $463,950, the figures the calculator shows on a 25-year amortization.
CMHC premium schedule
The premium is a percentage of the mortgage, not of the price, and the rate depends on the loan-to-value ratio (the mortgage divided by the price). CMHC’s rates on a purchase with a 25-year amortization:
| Loan-to-value | Down payment | Premium | With a 30-year amortization |
|---|---|---|---|
| 80.01% to 85% | 15% to 19.99% | 2.80% | 3.00% |
| 85.01% to 90% | 10% to 14.99% | 3.10% | 3.30% |
| 90.01% to 95% | 5% to 9.99% | 4.00% | 4.20% |
The 30-year column adds the 0.20 percentage-point surcharge for an amortization longer than 25 years, which an insured mortgage can have only for a first-time buyer or a newly built home (up to 30 years).
With 80% or less borrowed, insurance isn’t required. CMHC’s schedule also lists rates for loans in that range, which a lender may choose to insure: 0.60% up to 65% loan-to-value, 1.70% up to 75% and 2.40% up to 80%.
The premium at four down payments
| Down payment | Mortgage | Premium rate | Premium | Mortgage with premium |
|---|---|---|---|---|
| 5% | $475,000 | 4.00% | $19,000 | $494,000 |
| 10% | $450,000 | 3.10% | $13,950 | $463,950 |
| 15% | $425,000 | 2.80% | $11,900 | $436,900 |
| 20% | $400,000 | Not required | $0 | $400,000 |
On this price, going from 5% to 10% down lowers the premium by $5,050, and the mortgage itself is smaller too.
Step by step: one purchase
| Step | Calculation | Amount |
|---|---|---|
| Purchase price | $550,000 | |
| Down payment | $550,000 × 7.5% | $41,250 |
| Mortgage | Price minus down payment | $508,750 |
| Loan-to-value | Mortgage ÷ price | 92.5% |
| Premium | Mortgage × 4.00% | $20,350 |
| Mortgage with premium | Mortgage plus premium | $529,100 |
The premium is added to the balance, so you pay interest on it for as long as it’s part of the mortgage. You can usually pay it in cash at closing instead, which avoids that interest but uses cash you might need for other closing costs.
Premiums at the minimum down payment
The minimum down payment is 5% of the first $500,000 and 10% of the rest for homes under $1.5 million, and 20% at $1.5 million or more. The mortgage down payment calculator works out the minimum for any price. At the minimum, the loan is above 90% of the price, so the top premium rate applies:
| Price | Minimum down payment | Mortgage | Premium | Mortgage with premium |
|---|---|---|---|---|
| $600,000 | $35,000 | $565,000 | $22,600 | $587,600 |
| $1,000,000 | $75,000 | $925,000 | $37,000 | $962,000 |
The price cap, the debt-service limits and the other conditions for an insured mortgage are covered in CMHC mortgage rules.
Sales tax on the premium
Some provinces apply their sales tax to the mortgage insurance premium, and that tax can’t be added to the mortgage: it’s paid in cash on closing. The rates, a worked example and how it shows up at closing are in PST on mortgage default insurance.
CMHC, Sagen and Canada Guaranty
Canada has three mortgage default insurers: Canada Mortgage and Housing Corporation (CMHC), a federal Crown corporation, and two private insurers, Sagen and Canada Guaranty. The lender, not the borrower, normally chooses which one insures the loan, and each publishes its own premium schedule; the calculator and tables here use CMHC’s. The insurance protects the lender if you default, not you. What default insurance is, and the ways buyers avoid it, are covered in what CMHC insurance is.
Ways to lower the premium
- Reach the next band. The rate drops at 10% and 15% down, and disappears at 20%; a down payment just short of a band boundary pays the higher rate on the whole loan.
- Use registered savings. A First Home Savings Account and the Home Buyers’ Plan can both go toward the down payment.
- Keep the amortization at 25 years, which avoids the 30-year surcharge, at the cost of higher regular payments.
The loan-to-value calculator shows how close a down payment is to the next band, and the mortgage calculator shows the payments on the insured mortgage.
Sources
The figures and rules on this page come from these sources, last checked against them between September 25, 2026 and September 29, 2026. How we check facts.
- CMHC: CMHC Purchase
- CMHC: Home Start
- Department of Finance Canada: Boldest mortgage reforms in decades come into force today
- Financial Consumer Agency of Canada: How much you need for a down payment
- Justice Laws (Canada): Bank Act