CMHC Mortgage Insurance Explained (2026 Premiums, PST, Who Pays)
CMHC insurance costs 2.80% to 4.00% of your mortgage with less than 20% down. Premiums at 5%, 10% and 15% down, the PST due in cash, and who is exempt.
If your down payment is under 20%, your mortgage must be insured against default, and you pay the premium: 4.00% of the loan at 5% to 9.99% down, 3.10% at 10% to 14.99%, and 2.80% at 15% to 19.99%. On a $500,000 home with 10% down the premium is $13,950, added to your mortgage, plus $1,116 of Ontario PST paid in cash on closing. The insurance protects the lender, not you.
Figures come from the CostToClose CMHC calculator, using CMHC's published premium table.
What it is and who it protects
Mortgage default insurance lets lenders write mortgages with as little as 5% down because, if the borrower defaults and the sale of the home does not cover the debt, the insurer pays the lender the shortfall. Three insurers offer it (CMHC, a Crown corporation, plus Sagen and Canada Guaranty) at identical premium rates. "CMHC insurance" has become the generic term.
It does nothing for you if you lose your job or become ill. That is mortgage life or disability insurance, an optional product lenders sell separately.
The 2026 premium table
| Down payment | Loan-to-value | Premium rate |
|---|---|---|
| 5% to 9.99% | 90.01% to 95% | 4.00% |
| 10% to 14.99% | 85.01% to 90% | 3.10% |
| 15% to 19.99% | 80.01% to 85% | 2.80% |
| 20% or more | 80% or less | Not required |
Source: CMHC, mortgage loan insurance premiums. Checked 14 September 2026. A 0.20% surcharge applies to 30-year amortizations, which are available on insured mortgages only to first-time buyers and buyers of new construction.
The rate is applied to the mortgage amount, not the price, and the premium is added to the mortgage so you pay interest on it for the life of the loan.
What it costs on a $500,000 home
| Down payment | Mortgage | Premium rate | Premium | Ontario PST (8%) | Total mortgage |
|---|---|---|---|---|---|
| 5% ($25,000) | $475,000 | 4.00% | $19,000 | $1,520 | $494,000 |
| 10% ($50,000) | $450,000 | 3.10% | $13,950 | $1,116 | $463,950 |
| 15% ($75,000) | $425,000 | 2.80% | $11,900 | $952 | $436,900 |
| 20% ($100,000) | $400,000 | — | $0 | $0 | $400,000 |
Produced by the CostToClose calculator. PST on the premium applies in Ontario (8%), Quebec (9%), Saskatchewan (6%) and Manitoba (7%) and cannot be added to the mortgage.
Going from 5% to 10% down on this house costs $25,000 more up front and saves $5,050 in premium, $404 in PST, and roughly $30 a month in interest on the smaller premium over 25 years.
The PST trap
The premium itself never shows up as a cheque. The sales tax on it does. In Ontario a buyer with 10% down on a $750,000 home owes $1,674 in cash on closing for PST on a $20,925 premium. It's a line that appears on the lawyer's statement and surprises anyone who assumed "it's all rolled in." BC, Alberta and the Atlantic provinces do not tax the premium.
When insurance is not available
- Price of $1.5 million or more (the insured cap since 15 December 2024).
- Amortization over 30 years, or over 25 years unless you are a first-time buyer or buying new construction.
- Non-owner-occupied rental property (requires 20% down).
- Refinances, with limited exceptions.
Worked example from the calculator
First-time buyer, $600,000 new-build townhouse, 10% down, choosing a 30-year amortization:
| Item | Amount |
|---|---|
| Mortgage before insurance | $540,000 |
| Base premium (3.10%) | $16,740 |
| 30-year surcharge (0.20%) | $1,080 |
| Total premium, added to mortgage | $17,820 |
| Quebec PST on premium (9%), cash on closing | $1,604 |
Is it worth avoiding?
Reaching 20% avoids the premium and the PST, but it can also mean paying a higher interest rate: insured mortgages are typically priced 0.10 to 0.30 percentage points below uninsured ones because they are cheaper for lenders to fund. On a $450,000 mortgage that is worth roughly $25 to $75 a month. Compare the two total costs with the calculator rather than assuming 20% always wins, and never drain your closing-cost reserve to get there.
Who this covers
This is for a standard high-ratio insured mortgage on an owner-occupied home, priced by one of the three approved insurers (CMHC, Sagen, Canada Guaranty) using their published premium grid. It doesn't apply to rental or investment properties, which require 20% down regardless, or to refinances, which follow different insurance rules.
What this doesn't include
- The insurer's actual underwriting decision. Eligibility also depends on credit score, your GDS/TDS ratios, and the property itself. The premium table shows the rate if you're approved, not whether you will be.
- Any lender- or insurer-specific top-up beyond the standard grid, which can apply to higher-risk files.
- The exact interest-rate difference an insured mortgage gets you at your specific lender. The 0.10% to 0.30% range mentioned above is a general market pattern, not a quote.
- Portability details for a specific lender if you sell and buy again. The rules on what transfers and what doesn't vary by lender.
- Extra documentation or surcharges some insurers apply for self-employed or non-traditional income.
Questions worth asking a professional
- Ask your lender for the actual premium quote on your file. Insurers occasionally apply a top-up beyond the standard grid for higher-risk applications.
- Ask how much lower your specific rate is because the mortgage is insured, so you can weigh that saving against the premium and PST cost directly.
- If you're self-employed or have non-traditional income, ask whether extra documentation or a rate surcharge applies to your file.
- Planning to sell and buy again within a few years? Ask about your lender's specific portability rules before assuming the insurance carries over.
Frequently asked questions
How much is CMHC insurance on a $500,000 mortgage?
$20,000 at 5% down (4.00%), $15,500 at 10% down (3.10%), or $14,000 at 15% down (2.80%). Multiply the premium rate by the mortgage amount, not the price.
Is CMHC insurance a one-time payment?
Yes. The premium is charged once and added to the mortgage principal; you pay interest on it over the amortization. The PST on the premium is a one-time cash payment at closing.
Can I get a refund of CMHC insurance if I sell early?
No. The premium is not refundable. If you move and port the mortgage to a new home you may be able to transfer the coverage; ask your lender.
Do I need CMHC insurance with 20% down?
No. Mortgages with 20% or more down are "conventional" and uninsured, although some lenders insure them at their own cost for funding reasons.
Is CMHC insurance tax deductible?
Not on your own home. On a rental property the premium is generally deductible over the amortization period; confirm with your accountant.
Sources
- CMHC, Mortgage loan insurance premiums and eligibility — checked 14 Sept 2026
- Department of Finance Canada, mortgage insurance rule changes effective 15 December 2024 — checked 14 Sept 2026
- Ontario Ministry of Finance, Retail Sales Tax on insurance premiums — checked 14 Sept 2026
- Financial Consumer Agency of Canada, mortgage loan insurance — checked 14 Sept 2026
This guide is general information for Canadian home buyers and sellers, checked against the sources listed above on the date shown. It is not legal, tax, or mortgage advice. Rules and rates change; confirm current figures with your lawyer or notary, your lender, or the government office that administers the tax before relying on them.