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CMHC mortgage insurance.
How CMHC pricing works
If your down payment is below 20% on a Canadian residential mortgage, default insurance is required. The premium is calculated as a percentage of the loan (not the price) and is added to the mortgage balance, you do not pay it as cash at closing. Down payments at 5–9.99% trigger a 4.00% premium; 10–14.99% triggers 3.10%; 15–19.99% triggers 2.80%. Above 20% there is no premium. Alberta does not charge PST on the premium, so the Calgary buyer pays only the premium itself (no provincial sales tax surcharge).
Frequently asked questions
What is CMHC mortgage insurance?
Federally regulated mortgage default insurance, required when your down payment is below 20%. CMHC, Sagen, and Canada Guaranty all provide it; lenders pick. The premium is added to the mortgage balance.
What are the current premium rates?
4.00% at 5–9.99% down, 3.10% at 10–14.99%, 2.80% at 15–19.99%. Above 20%, no premium.
Does Alberta charge tax on the premium?
No. Alberta does not charge PST on the premium. Calgary buyers avoid the small surcharge that Ontario, Quebec, Saskatchewan, and Manitoba apply.
Educational. Premium rates can change; verify with your mortgage broker before closing.