Your down payment changes both your mortgage amount and whether mortgage default insurance is required.
For many owner-occupied purchases in Canada, mortgage loan insurance is generally required when the down payment is less than 20%, subject to the lender and insurer rules.
Minimum Down Payment
For an eligible insured purchase, CMHC currently states:
- 5% on the first $500,000 of the purchase price
- 10% on the portion above $500,000
- Homes priced at $1.5 million or more are not eligible for CMHC mortgage loan insurance and generally require at least 20% down
What the Insurance Does
Mortgage default insurance protects the lender, not the buyer. The premium depends on the loan-to-value ratio and can usually be added to the mortgage amount.
Official calculator: CMHC mortgage loan insurance premium calculator. Confirm the exact premium and eligibility with your lender or mortgage professional.
20% Down Is Not the Same as the Offer Deposit
The offer deposit is money delivered under the Agreement of Purchase and Sale and forms part of your funds on closing. Your total down payment is the larger financing calculation used to determine the mortgage amount.