CMHC Insurance Calculator Canada

What is CMHC Mortgage Default Insurance?

CMHC mortgage default insurance (commonly called CMHC insurance or mortgage insurance) is mandatory in Canada when your down payment is less than 20% of the home purchase price. Despite the name, this insurance protects the lender — not you, the borrower — in case you default on your mortgage payments. It allows lenders to offer mortgages with smaller down payments because the risk of loss is transferred to the insurer.

Three companies provide mortgage default insurance in Canada: CMHC (Canada Mortgage and Housing Corporation, a Crown corporation), Sagen (formerly Genworth Financial), and Canada Guaranty. All three charge the same premium rates, so the choice of insurer is typically made by your lender, not by you. Our calculator uses the standard rates that apply to all three providers.

CMHC Insurance Premium Rates (2026)

The premium is calculated as a percentage of your mortgage amount (not the home price), and the rate depends on your down payment percentage (or equivalently, your loan-to-value ratio):

*Monthly payment impact based on 25-year amortization at 4.99%. The premium is added to your mortgage balance, so you pay interest on it over the life of your loan — making the true cost higher than the premium alone.

How CMHC Insurance is Calculated

The calculation is straightforward:

Step 1: Calculate your mortgage amount: Home Price − Down Payment = Mortgage

Step 2: Determine your LTV ratio: Mortgage ÷ Home Price × 100 = LTV%

Step 3: Find the premium rate based on your LTV (see table above)

Step 4: Calculate the premium: Mortgage × Premium Rate = CMHC Premium

Step 5: Add premium to mortgage: Mortgage + CMHC Premium = Total Mortgage

Example: $500,000 home with 5% down ($25,000):

• Mortgage: $500,000 − $25,000 = $475,000
• LTV: $475,000 ÷ $500,000 × 100 = 95%
• Premium rate: 4.00% (LTV 90.01-95%)
• CMHC premium: $475,000 × 4.00% = $19,000
• Total mortgage: $475,000 + $19,000 = $494,000

This $19,000 premium is added to your mortgage balance. At 4.99% over 25 years, it costs you approximately $33,300 in total (premium + interest on the premium). This is the true cost of CMHC insurance — significantly more than the premium alone.

CMHC Insurance Cost Examples by Home Price

*For homes between $500,000 and $999,999, the minimum down payment is 5% on the first $500,000 plus 10% on the remainder. Homes at $1,500,000 or above require 20% minimum and are not eligible for CMHC insurance.

Is CMHC Insurance Worth It?

This is one of the most common questions from Canadian home buyers. The answer depends on your situation:

Arguments FOR Buying with Less Than 20% Down (and Paying CMHC)

• Enter the market sooner — saving 20% of $500,000 ($100,000) could take years. During that time, home prices may rise more than the CMHC premium costs.
• Lower interest rates — insured mortgages often qualify for lower interest rates (sometimes 0.10-0.20% less) because the lender's risk is eliminated. This partially offsets the insurance cost.
• Opportunity cost of waiting — the money sitting in savings earning 3-4% while home prices rise 5-10% means you fall further behind.
• 30-year amortization for first-time buyers — insured mortgages now allow 30-year amortization for first-time buyers purchasing new builds, lowering monthly payments.

Arguments AGAINST (Save for 20% Down Instead)

• True cost is higher than the premium — a $19,000 premium financed over 25 years at 4.99% costs approximately $33,300 total.
• Lower monthly payments without CMHC — a smaller mortgage means lower payments, less interest, and more financial flexibility.
• More equity from day one — 20% down gives you immediate equity cushion against price declines.
• Negotiating power — a conventional (uninsured) mortgage with 20%+ down often provides better terms and more lender options.

Minimum Down Payment Rules in Canada (2026)

The minimum down payment in Canada depends on the purchase price:

Use our Down Payment Calculator to figure out exactly how much you need to save, and our Mortgage Calculator to see your monthly payments with and without CMHC insurance.

How to Avoid CMHC Insurance

1. Save a 20% down payment — the most straightforward way. On a $500,000 home, that means $100,000.
2. Use the RRSP Home Buyers' Plan (HBP) — withdraw up to $60,000 per person ($120,000 per couple) from your RRSP tax-free toward your down payment. See our RRSP Calculator.
3. Receive a gift from family — most lenders accept gifted down payments from immediate family members with a signed gift letter confirming the money is not a loan.
4. Buy a less expensive property — a lower price means a smaller 20% threshold. A $400,000 home needs only $80,000 down to avoid CMHC.
5. Consider a different location — homes outside major city centres are often significantly cheaper, making the 20% threshold more achievable.

CMHC vs Sagen vs Canada Guaranty

All three mortgage default insurers in Canada charge the same premium rates. The main differences are:

Your lender typically chooses the insurer, not you. However, if you are self-employed or a new immigrant, you may benefit from asking your broker to submit to Sagen or Canada Guaranty, which sometimes have more flexible underwriting guidelines than CMHC for non-traditional borrowers.