By law, financial institutions require that all mortgages with a loan to value ratio greater than 80% be insured against default. CMHC provides mortgage loan insurance to approved lenders in the event that the home owner defaults on their mortgage. Depending on the situation, a lender may also request that a conventional mortgage be insured through CMHC.

The following is a summary of the insurance premiums for different loan to value ratios:

^{* Please note that for extended amortizations, CMHC will add .20 for every 5 years beyond a 25 year amortization. So, for a 35 year amortization, there is a .40 premium surcharge added. This premium surcharge applies no matter which high ratio insurance program you are applying under.}

In a refinance transaction, the premium payable is the lesser of a) the new loan amount multiplied by the full premium rate below, or b) the increase in loan amount (top-up amount) multiplied by the top-up premium rate in the table above. The insurance premium may be paid in full on closing or added to the mortgage amount. If added to the mortgage, interest is then paid on the insurance premium over the amortization of the mortgage. Since most buyers do not have the extra cash on closing, it is most common to add the premium to the mortgage.

High Ratio Financing for Self Employed Applicants

^{* Please note that for extended amortizations, CMHC will add .20 for every 5 years beyond a 25 year amortization. So, for a 35 year amortization, there is a .40 premium surcharge added. This premium surcharge applies no matter which high ratio insurance program you are applying under.}