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CMHC Mortgage Rules in Canada: Insurance, Premiums and the $1.5 million Limit (2026)

Updated

CMHC’s rules decide when a mortgage needs default insurance, what it costs and which homes and borrowers qualify. This page sets them out, including the higher price limit that took effect on December 15, 2024.

What mortgage loan insurance is

FCAC puts it plainly: “Mortgage loan insurance protects the mortgage lender in case you can’t make your mortgage payments. It doesn’t protect you.” If your down payment is under 20%, you’ll typically need it. Three companies provide it: the Canada Mortgage and Housing Corporation (CMHC), Sagen and Canada Guaranty. Even with a larger down payment, a lender may require it, for example if you’re self-employed or have a poor credit history.

Premiums

CMHC’s premium is a percentage of the loan and depends on the loan-to-value ratio (CMHC Purchase):

Down paymentLoan-to-valuePremium
15% to 19.99%80.01% to 85%2.80%
10% to 14.99%85.01% to 90%3.10%
5% to 9.99%90.01% to 95%4.00%

With a 30-year amortization through CMHC Home Start, each premium is 0.20 points higher. You can add the premium to your mortgage or pay it up front; if you add it, you pay interest on it at your mortgage rate. Ontario and Quebec charge provincial sales tax on the premium, and so does Saskatchewan, whose PST bulletin lists mortgage default insurance as taxable. The lender can’t add that tax to the mortgage, so it’s paid at closing. PST on mortgage insurance has the rates.

Minimum down payment

Purchase priceMinimum down payment
$500,000 or less5%
Above $500,000, below $1,500,0005% of the first $500,000 and 10% of the rest
$1,500,000 or more20% (can’t be insured)

On a $900,000 home the minimum is $65,000. The down payment rules are FCAC’s.

The $1.5 million price limit

The price limit for insured mortgages rose from $1 million to $1.5 million on December 15, 2024 (Finance Canada); CMHC says the price “must be below $1,500,000”. Before, a home of $1 million or more needed 20% down. Now a buyer can put down the tiered minimum and insure the loan:

Home priceMinimum down paymentCMHC premiumMortgage with premiumDown payment at 20%
$1,100,000$85,000$40,600$1,055,600$220,000
$1,300,000$105,000$47,800$1,242,800$260,000
$1,450,000$120,000$53,200$1,383,200$290,000

The smaller down payment comes with a bigger loan and a premium on top. On the $1,300,000 home, the income needed under the stress test is about $283,700 with the minimum down payment and $252,100 with 20% down (how it’s worked out).

Amortization

CMHC’s maximum amortization for an insured purchase is 25 years. Since December 15, 2024, first-time buyers and buyers of new builds can take 30 years (Finance Canada). 30-year amortization rules covers who qualifies.

Who and what is eligible

From CMHC Purchase:

  • Borrowers: Canadian citizens, permanent residents, or non-permanent residents authorized to work in Canada.
  • Occupancy: the home must be occupied by the borrower, or by a relative (by marriage, common-law partnership or a parent-child relationship) living there rent-free.
  • Property: in Canada, suitable for full-time, year-round occupancy, with year-round vehicle access. Up to 95% loan-to-value for 1 to 2 units, 90% for 3 to 4 units.
  • Down payment sources: savings, the sale of a property or a non-repayable gift from a relative. For 1 or 2 units above 90% loan-to-value, borrowers with strong credit can use non-traditional sources such as an unsecured loan.

The stress test

Insured borrowers must qualify at the greater of their contract rate plus 2% or 5.25%, and CMHC’s debt service limits are 39% (GDS) and 44% (TDS). How the stress test works has the detail.

Sources

The figures and rules on this page come from these sources, last checked against them between September 25, 2026 and October 2, 2026. How we check facts.