Premium by loan-to-value
Standard insured mortgage rates. Add 0.20% for any amortization over 25 years. PST on the premium is charged separately in BC at 7%.
| LTV band | Premium rate |
|---|---|
| ≤ 65% LTV | 0.6% |
| 65.01–75% LTV | 1.7% |
| 75.01–80% LTV | 2.4% |
| 80.01–85% LTV | 2.8% |
| 85.01–90% LTV | 3.1% |
| 90.01–95% LTV | 4.0% |
Worked example: $700K home, four down-payment scenarios
25-year amortization, 4.5% contract rate. Premium added to loan balance. Indicative only.
| Down | LTV | Premium rate | Premium $ | Monthly P&I |
|---|---|---|---|---|
| 5% ($35,000) | 95.00% | 4.00% | $26,600 | $3,844 |
| 10% ($70,000) | 90.00% | 3.10% | $19,530 | $3,610 |
| 15% ($105,000) | 85.00% | 2.80% | $16,660 | $3,400 |
| 19.99% ($139,930) | 80.01% | 2.80% | $15,682 | $3,200 |
What CMHC mortgage insurance actually does
CMHC mortgage default insurance protects the lender if you stop paying. It does not protect you. The buyer pays the premium (added to the loan balance in nearly every case), but the policy benefits the lender. That framing matters because every other tax and program FRIVE writes about helps the buyer directly. CMHC insurance is the one that costs the buyer real money to protect someone else's interest. In exchange, the federal program allows lenders to issue mortgages with as little as 5% down without taking on too much default risk, which means first-time buyers can enter the market years earlier than they otherwise could.
The premium tiers, by loan-to-value
Premium rates are set by CMHC's published premium table and apply identically at the two private competitors (Sagen and Canada Guaranty). Loan-to-value (LTV) is the loan amount as a percentage of the property's value. The higher the LTV, the higher the premium.
Above the LTV-based premium, CMHC adds a 0.20% surcharge for any mortgage with an amortization longer than 25 years. Since December 15, 2024, first-time buyers and new-construction buyers are eligible for 30-year amortizations on insured mortgages, which means that surcharge applies to a much larger share of first-time buyer purchases than it used to.
The 19.99% vs 20% down decision
This is the question we see most often: should you stretch to put 20% down and avoid the premium, or accept 19.99% and pay the premium to keep more cash on hand? The math is less obvious than it sounds.
At 19.99% down (just under the 20% threshold), CMHC charges the 80% LTV premium rate of 2.4% on the loan. On an $800K home, that's a $640K base loan and roughly $15,360 in premium added to the balance. Insured rates are typically 15 to 30 basis points lower than uninsured rates because the lender carries less risk. Over a 5-year term, the rate-spread savings on a $640K loan can range from $4,800 to $9,600. The premium costs more than the rate savings recover in the first term, but the rate spread persists at every renewal, and the cash you didn't put into the down payment can earn return elsewhere.
The clean answer: if you have exactly 20% to put down and no cash cushion left over, putting 19.99% down to keep $1,500 in savings is often the right move. If you have meaningfully more than 20% saved, put down 20% and skip the premium. Run your specific numbers through the calculator above to see your premium cost.
How the premium changes your monthly payment
The premium is added to the loan balance, not paid in cash at closing. So on a $700K mortgage with a 10% down payment, the 3.1% premium (90% LTV tier) adds roughly $21,700 to the loan, taking the actual amount you owe from $630K to $651,700. At a 4.5% contract rate over 25 years, that bumps the monthly payment by about $120/month. Spread over the life of the mortgage, the premium is a meaningful cost, but on a month-to-month basis it's a small fraction of the total payment.
CMHC, Sagen, and Canada Guaranty
Three insurers operate in Canada. CMHC is the federal Crown corporation. Sagen (formerly Genworth) and Canada Guaranty are private competitors. Premium rates are matched across all three, so which insurer covers your loan is invisible to most buyers. The slight differences are in underwriting flexibility: Sagen tends to be slightly more flexible on self-employed and commission income, Canada Guaranty has a strong rural and small-town presence. Your lender picks the insurer; you don't.
When you can stop paying for CMHC insurance
You can't. The premium is paid once, added to the loan balance at closing, and amortized over the life of the mortgage. There is no equivalent of the US "PMI drop" at 20% equity. If you renew or refinance with the same lender at the same balance, the premium carries over (you don't pay again). If you refinance to take cash out and your new loan is over 80% LTV, you'll pay a new premium on the new high-ratio loan.
Does it ever make sense to refinance to remove the insurance?
Rarely. The premium is already paid (added to the balance years ago) and refinancing doesn't refund it. The only scenario where it makes sense to refinance specifically to "escape" the insured rate menu is when you've built substantial equity AND uninsured rates are meaningfully lower than what your renewal rate would be. Even then, the math is dominated by the new rate vs old rate, not by the insurance question. Our refinance break-even calculator models that.
How to use this calculator
Plug your price, down payment, and amortization into the calculator above. The result shows the premium tier you fall into, the dollar amount added to your loan, and the impact on your monthly payment. Use it to compare a 19.99% vs 20% scenario, a 25-year vs 30-year amortization, and the difference between two prices that straddle a premium tier boundary. Book a 20-minute chat with the FRIVE team if you want a second opinion on whether putting more down is worth the savings stretch.
Frequently asked questions
Is CMHC mortgage insurance the same as home insurance?
No. CMHC mortgage default insurance protects the lender if you stop paying the mortgage. Home insurance protects you if the house burns down or someone slips on the porch. Both are required for most mortgages, but they cover different risks and they cost different money.
Do I have to use CMHC? Can I choose Sagen or Canada Guaranty?
Your lender chooses the insurer. Buyers rarely care because premium rates are matched across all three. If you have a specific underwriting situation (self-employed, commission, rural property, non-standard property type), your mortgage broker can ask the lender to submit to a specific insurer that's known to be more flexible on that situation.
What's the minimum credit score for CMHC insurance?
600 is the typical minimum for high-ratio insured purchases. Some lenders require 680 or higher for their best insured rates. If your score is in the 600 to 680 band, your rate may be slightly higher than the best advertised rate, but you'll still qualify under CMHC's program rules.
Can I pay the premium in cash instead of adding it to the loan?
Yes, but almost no one does. The default is to add the premium to the loan balance and amortize it. Paying in cash saves the interest on the premium amount over the life of the mortgage, but it requires more cash at closing — which most first-time buyers don't have to spare. If you have the choice, the math usually favours adding it to the loan.
Is PST charged on the CMHC premium in BC?
Yes. BC charges 7% Provincial Sales Tax on the CMHC premium. The PST cannot be added to the loan balance — it has to be paid in cash at closing. On a $21,000 premium, that's about $1,470 of additional closing-day cash. Factor it into your cash to close total.
What changed in December 2024 for CMHC?
Two big federal changes took effect December 15, 2024: the insured mortgage cap rose from $1 million to $1.5 million, and 30-year amortizations became available on insured mortgages for first-time buyers (any purchase) and for buyers of newly constructed homes. CMHC adds the 0.20% surcharge to the premium for any 30-year amortization.
Does CMHC insurance stack with the BC PTT first-time buyer exemption?
Yes. They're entirely separate programs. The CMHC premium reduces the down payment threshold required to enter the market. The BC first-time buyer PTT exemption reduces the closing-day cash for qualifying first-time buyers. Many of our buyers use both.
If I put down 19.99%, what tier am I in?
80.01% LTV falls into the next tier above 80% — which is the 85% LTV tier at 2.8%. Buyers commonly think 19.99% gets the 80% tier rate; it doesn't. To get the 80% tier (2.4% premium), you need an LTV at or below 80%, which means a down payment of exactly 20% or more. This tier-boundary effect is why dropping a hair below 20% can be meaningfully more expensive than buyers expect.
What if I'm self-employed?
CMHC offers a Self-Employed product with looser documentation requirements (no two-year T1 history required), but the premium is higher than the standard tiers. Most self-employed first-time buyers we work with use the standard CMHC program with two years of T1 generals, because the premium savings are meaningful and the documentation isn't onerous.
Can I get my CMHC premium back if I pay off the mortgage early?
No. The premium is non-refundable. Paying off the mortgage early does not trigger a refund of any portion of the premium already paid. The premium is the cost of buying the right to enter the market with a smaller down payment, and it stays paid.
Sources
- CMHC — Mortgage loan insurance cost (premium table). cmhc-schl.gc.ca
- Government of Canada — December 2024 insured mortgage rule changes (cap to $1.5M, 30-year amortization for FTB and new construction). canada.ca/department-finance
- Government of BC — PST on financial services (including CMHC premium). gov.bc.ca/pst
- FRIVE journal — Closing costs for a first home in the Fraser Valley. closing-costs-first-home-fraser-valley
