Cmhc Fees Ontario Calculator
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Reviewed by Calculator Editorial Team
CMHC insurance is a government-backed mortgage insurance program in Ontario that protects lenders against losses if a borrower defaults. This calculator helps you estimate the CMHC fees you'll need to pay when purchasing a home in Ontario.
What is CMHC Insurance?
CMHC (Canada Mortgage and Housing Corporation) insurance is a type of mortgage insurance that protects lenders when they make loans to borrowers with down payments of less than 20% of the home's purchase price. In Ontario, CMHC insurance is required for conventional mortgages when the down payment is less than 20%.
CMHC insurance is not the same as private mortgage insurance (PMI) offered by private insurers. It's a government-backed program with different terms and conditions.
The CMHC insurance premium is calculated based on the loan amount, the down payment percentage, and the amortization period of the mortgage. The premium is typically paid monthly along with the mortgage payments.
How to Calculate CMHC Fees
The CMHC insurance premium is calculated using the following formula:
Where:
- Loan Amount - The amount borrowed from the lender (purchase price minus down payment)
- Rate - The CMHC insurance rate based on the down payment percentage and amortization period
- 12 - The number of months in a year (since premiums are paid monthly)
The CMHC insurance rate varies based on:
- Down payment percentage (less than 20%)
- Amortization period (typically 25, 30, or 35 years)
- Whether the property is a condominium or single-family home
For example, if you have a $400,000 mortgage with a 10% down payment and a 25-year amortization period, the CMHC insurance rate might be around 2.5% per year.
CMHC Fee Structure
The CMHC insurance premium is typically calculated annually and then divided by 12 to get the monthly premium. Here's a breakdown of the key components:
| Component | Description |
|---|---|
| Loan Amount | The portion of the home price that's being financed |
| CMHC Rate | The percentage applied to the loan amount (varies by down payment and amortization) |
| Annual Premium | Loan Amount × CMHC Rate |
| Monthly Premium | Annual Premium ÷ 12 |
CMHC insurance rates are set by the government and are subject to change. It's important to check the current rates before applying for a mortgage.
Worked Examples
Example 1: $400,000 Mortgage with 10% Down Payment
Home Price: $500,000
Down Payment: 10% of $500,000 = $50,000
Loan Amount: $500,000 - $50,000 = $450,000
Amortization: 25 years
CMHC Rate: 2.5% (for 10% down payment and 25-year amortization)
Example 2: $300,000 Mortgage with 5% Down Payment
Home Price: $400,000
Down Payment: 5% of $400,000 = $20,000
Loan Amount: $400,000 - $20,000 = $380,000
Amortization: 30 years
CMHC Rate: 3.2% (for 5% down payment and 30-year amortization)