Mortgage Insurance Rates

To obtain Mortgage Loan Insurance, lenders pay an insurance premium. Typically, your lender will pass these costs on to you. Your lender will give you the exact price when you apply for a mortgage. There are three insurers in Canada: CMHC, Sagen and Canada Guaranty.

The Mortgage Loan Insurance premium is calculated as a percentage of the loan and is based on the size of your down payment. The higher the percentage of the total house price/value that you borrow, the higher percentage you will pay in insurance premiums.

Remember: without mortgage insurance you may avoid the insurance premium but you’ll typically pay much higher interest rates and potential additional administrative fees. At the end of the day, for the vast majority of borrowers, the cost of Mortgage Loan Insurance is more than fully offset by the savings achieved in the term of your mortgage.

A premium refund of up to 25% may be available when an insured mortgage is used to finance an Energy-Efficient Home. To read more about the rebate click here

For portability and refinance, the premium is the lesser of Premium on Increase to Loan Amount or the Premium on Total Loan Amount. In the case of portability, a premium credit may be available under certain conditions.

* For portability the maximum LTV ratio is 90%, but the insurer may consider higher lending ratios when the new ratio is equal to or less than the original LTV. For portability, the premium is higher for non-traditional down payments on Increase to Loan Amount.

** For conversion from Self-Employed with traditional 3rd party income validation to Self Employed without traditional 3rd party income validation, the premium is the lesser of: a) the Premium on Total Loan Amount or; b) the outstanding balance multiplied by a 1.5% premium plus the Premium on Increase to Loan Amount.

*** Down Payment Requirements – Traditional sources of down payment include: Applicant’s savings, RRSP withdrawal, funds borrowed against proven assets, sweat equity (<50% of min.required equity), land unencumbered, proceeds from sale of another property, non-repayable gift from immediate relative, equity grant (non-repayable grant from federal, provincial or municipal agency). Non-traditional sources of down payment include: Any source that is arm’s length to and not tied to the purchase or sale of the property, such as borrowed funds, gifts, and 100% sweat equity.

Premiums in Ontario are subject to provincial sales tax. The provincial sales tax cannot be added to the loan amount.