Quebec CMHC Insurance

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In Canada, homebuyers with less than 20% down payment are required to purchase mortgage default insurance, or CMHC insurance. Mortgage default insurance protects lenders in the event a home buyer defaults on a mortgage. Thanks to this protection, lenders can offer lower mortgage rates for higher risk mortgages and mortgages with lower down payments

Quebec CMHC Insurance Calculator

Asking Price

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 STEP 1
Enter the price of the home you're interested in and press GO.
Down payment Down payment The amount of money you pay up front to obtain a mortgage. The minimum down payment in Canada is 5%. For down payments of less than 20%, home buyers are required to purchase mortgage default insurance, commonly referred to as CMHC insurance.
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Amortization period Amortization period The length of time it will take a homeowner to pay off his/her mortgage. In Canada, the maximum amortization period for insurable mortgages is 25 years. Longer amortization periods allow homeowners to make smaller monthly payments, but equate to more interest paid over the life of the mortgage.  
 
STEP 2
Choose an amortization period.
Mortgage insurance Mortgage insurance Mortgage default insurance, commonly referred to as CMHC insurance, protects the lender in the case the borrower defaults on the mortgage. Mortgage default insurance is required on all mortgages with down payments of less than 20%, which are known as high ratio mortgages. Mortgage default insurance is calculated as a percentage applied to your mortgage amount. plus
Total Mortgage Required equals $- $- $- $-

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CMHC insurance regulation is set by the federal government and therefore, premium rates in Quebec are the same across Canada. Insurance premium rates range from 2.80% to 4.00% of your mortgage amount. The insurance premium is then added to your mortgage amount and paid off over your amortization period in your monthly mortgage payments. Federal regulations on CMHC insurance include the following:

  • CMHC insurance is required on all homes with less than 20% down payment.
  • Houses purchased for more than $1 million are not eligible for CMHC insurance, therefore requiring homeowners to put more than 20% down.
  • The maximum amortization period on a CMHC insured mortgage is 25 years
  • Homes sold over $500,000 can no longer be purchased with a 5% down payment. The new minimum down payment is 5% of the first $500,000, and 10% of any amount over $500,000.

QST on Mortgage Default Insurance – Quebec

In Quebec, QST on mortgage default insurance must also be paid. This tax is 9.975% of the CMHC insurance premium and is paid in full when your house closes. The QST is different from your insurance premium as it is not added to your mortgage balance, but due in a lump sum cash payment.


Mortgage default insurance rates

The CMHC insurance rate varies depending on your down payment percentage:

Down payment (% of home’s price) 5% - 9.99% 10% - 14.99% 15%-19.99% 20% or higher
CMHC insurance premium 4.00% 3.10% 2.80% 0%

The insurance premium is then calculated using the rate and your mortgage amount. For CMHC insured homes, your amortization period must be 25 years or less.


Sample Calculation for CMHC insurance in Quebec:

For a $300,000 home with a $40,000 down payment and an amortization period of 25 years, your insurance premium would be calculated as follows:

Quebec CMHC insurance calculation
( $40,000 down payment ÷ $300,000 home price) =
13.33% down payment percentage
$300,000 home price $40,000 down payment =
$260,000 mortgage before CMHC
( $260,000 mortgage before CMHC 3.10% CMHC tax rate) =
$8,060 CMHC insurance premium
$260,000 mortgage before CMHC $8,060 CMHC insurance premium =
$268,060 total mortgage
( $8,060 CMHC insurance premium 9.98% QST tax rate) =
$804 QST

You will pay the insurance premium of $8,060 in your monthly payments and the $804 QST with your closing costs.


Mortgage default insurance rates in Quebec with a non-traditional down payment

Using non-traditional sources of down payment will incur a surcharge on your CMHC insurance for down payments from 5% to 9.99%. Non-traditional sources include borrowed funds and gifts from non-immediate family members.

Down payment (% of home’s price) 5% - 9.99% 10% - 14.99% 15%-19.99% 20% or higher
CMHC insurance premium 4.50% 3.10% 2.80% 0%

Mortgage default insurance rates for self-employed, non-verified income

For self-employed home buyers without 3rd-party income, the minimum down payment required is 10% and insurance premiums on down payments from 10% - 19.99% are higher than those of regular applicants.

Down payment (% of home’s price) 5% - 9.99% 10% - 14.99% 15%-19.99% 20% or higher
CMHC insurance premium N/A 4.75% 2.90% 0%