Question 1

What is CMHC insurance and who needs it?

Accepted Answer

CMHC mortgage default insurance is required for any home purchase in Canada where the down payment is less than 20% and the price is $1.5 million or under. It protects the lender, not you, in case you default — but you pay the premium.

Question 2

How much does CMHC insurance cost?

Accepted Answer

The CMHC premium is 4.00% for 5%–9.99% down, 3.10% for 10%–14.99% down, and 2.80% for 15%–19.99% down. The premium is added to your mortgage balance — not paid at closing.

Question 3

Is CMHC insurance paid upfront?

Accepted Answer

The premium is added to your mortgage balance. However, Ontario charges 8% RST, Quebec 9% QST, and Saskatchewan 6% PST on the premium — these provincial taxes are due at closing as a cash payment.

Question 4

Can I avoid CMHC insurance?

Accepted Answer

Yes — by making a down payment of 20% or more. The RRSP Home Buyers Plan allows first-time buyers to withdraw up to $60,000 per person tax-free, which can help reach the 20% threshold.

Question 5

What changed in December 2024?

Accepted Answer

The federal government raised the insured mortgage limit from $1 million to $1.5 million. Buyers purchasing homes between $1M and $1.5M can now access CMHC insurance with less than 20% down — previously impossible.

Down Payment	LTV Ratio	Premium Rate
5% – 9.99%	90.01% – 95%	4.00%
10% – 14.99%	85.01% – 90%	3.10%
15% – 19.99%	80.01% – 85%	2.80%
20%+	80% or less	No insurance required

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