There are three mortgage insurers: Sagen, CMHC, and Canada Guaranty. Most lenders work with at least two of these, and all insurers provide comparable products and packages. If your down payment is less than 20%, you must pay the mortgage insurance premium.

This cost is added to the mortgage. This insurance exists to only protect the lender. This is not to be confused with mortgage insurance that behaves like life insurance and upon your death, is paid to cover the remainder of the mortgage.

CALCULATING MORTGAGE INSURANCE PREMIUMS

In this table, the Loan-to-Value Ratio means what percent the mortgage is, out of the total purchase price. If you were buying a $500,000 property and putting the minimum down payment of $25,000, your net mortgage amount is $475,000. That’s 95% LTV and results in the highest premium rate being applied to your mortgage. That would make your actual mortgage $494,000.