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CMHC Insurance Explained
What mortgage default insurance costs Canadian buyers with under 20% down.
When CMHC kicks in
Any down payment below 20% triggers mandatory mortgage default insurance through CMHC, Sagen, or Canada Guaranty. The premium is added to your loan and amortized over the term.
Premium tiers
Premiums are 2.8% (15-19.99% down), 3.1% (10-14.99%), and 4.0% (5-9.99%) of the loan amount. On a $700K home with 5% down, that's roughly $26,600 added to your mortgage.
Strategies to avoid it
Reaching 20% down eliminates the premium entirely. Some buyers use the First Home Savings Account (FHSA) or Home Buyers' Plan (RRSP) to bridge the gap.
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