Conventional vs high-ratio:
is 20% down actually
worth it?
If you have less than 20% down, you’ll pay a one-time CMHC-type premium — but typically get the lowest available rate. If you have 20%+, no premium, but sometimes a slightly higher rate. The real question: does stretching to 20% actually pay off?
Four factors that decide
which mortgage you have.
The 20% line is just the start. What it triggers on rate, premium, and flexibility is where the real comparison lives.
The 20% line that splits everything
Less than 20% down means a high-ratio mortgage. Twenty percent or more means conventional. That one threshold changes your premium, your rate, and what you can buy.
Insurance: mandatory vs. none
High-ratio mortgages require default insurance (CMHC, Sagen, or Canada Guaranty) — a one-time premium of 2.8%–4.0% of the mortgage, added to your balance. Conventional mortgages carry none.
Insured mortgages often get the lowest rate
Because default insurance protects the lender from loss, insured high-ratio mortgages earn their best rates. A buyer with 19% down can get a lower rate than one with 20% — a result many buyers don't expect.
Conventional unlocks more property types
Insured mortgages are limited to owner-occupied purchases under $1.5M on standard properties. Conventional opens up rentals, higher-value homes, 30-year amortization, and the ability to refinance.
Three steps to the
right product.
Know your position, run the numbers, then lock the right rate. That order matters.
Understand your down payment position
Know exactly how much you have and whether you can realistically reach 20% before the right home appears. Factor in what you'd do with that extra cash if you didn't put it all into a down payment.
Compare both paths on the numbers that matter
We run the insured and conventional scenarios side by side — net-of-premium rates, monthly payments, and total interest over your term — so the 'right' choice is clear before you apply.
Get pre-approved for the right product
One application, 100+ lenders. We present the strongest file to the lender that fits your path — insured, insurable, or fully conventional — and lock your rate for up to 120 days.
Which is right
for you?
Tap any situation below to see how we approach it.
If you’re…First-time buyer with 5–10% saved
First-time buyer with 5–10% saved
Buy now, get the lowest insured rate, and fold the premium into the mortgage. Waiting years to reach 20% often costs more than the premium — especially when prices are rising.
Start my pre-approvalIf you’re…You have 20% comfortably and want a rental
You have 20% comfortably and want a rental
Insurance isn't available on rentals or refinances anyway, so conventional is the only route. We shop the full lender market so you get the best available uninsured rate.
Get my rateIf you’re…You're at 18% and could reach 20% in a few months
You're at 18% and could reach 20% in a few months
Compare the insured rate at 18% vs a conventional or insurable rate at 20%, net of the premium. Sometimes the insured deal still wins — do the math before you wait.
Run my numbersIf you’re…Buying a home near $1.5M+
Buying a home near $1.5M+
Insured programs have a purchase-price ceiling, so higher-value homes require 20%+ down and a conventional mortgage by default. We shop the best uninsured lenders for your price point.
Explore my optionsIf you’re…You're refinancing to access home equity
You're refinancing to access home equity
Refinances generally can't be insured (except a narrow CMHC secondary-suite program). Your refinance will be conventional — up to 80% LTV — so shopping multiple lenders matters most here.
See refinance optionsIf you’re…You're buying a new build with a smaller down payment
You're buying a new build with a smaller down payment
New builds qualify for insured financing, and all first-time buyers can get the 30-year insured amortization since December 2024. You get the lowest rate and the lower monthly payment.
Get pre-approvedHigh-ratio vs conventional —
every factor compared.
Both have a genuine case. The right answer depends on your down payment, your goals, and the math we run on your file.
- Buying sooner without waiting to save 20%
- First-time buyers with a 5–19% down payment
- Getting the lowest available interest rate
- Putting savings toward other goals instead of a bigger down payment
- You already have 20%+ saved comfortably
- Buying a rental, a higher-value home, or 30-year amortization
- Avoiding the insurance premium entirely
- Refinances (which generally can't be insured)
| Factor | High-Ratio (Insured) | Conventional |
|---|---|---|
| Down payment | 5% to 19.99% (10% minimum on owner-occupied 3–4 units) | 20% or more |
| Default insurance | Mandatory (CMHC / Sagen / Canada Guaranty) | None |
| Premium cost | ~2.8%–4.0% of the mortgage, added to the balance | $0 |
| Interest rate | Usually the lowest (lender is protected) | Sometimes slightly higher |
| Max purchase price | Under $1.5M (insurance program limit) | No insurance-based limit |
| Amortization | Up to 25 yrs (30 for all first-time buyers and new builds) | Up to 30 years |
| Property types | Owner-occupied, standard properties | Includes rentals and more property types |
| Refinances | Not insurable (except a limited refinance to build a secondary suite) | Conventional, up to 80% LTV |
Rules and limits current as of 2026. Calculate your exact CMHC premium.
Common questions,
clear answers.
Premium costs, rate differences, rental rules, and the 20% threshold — answered plainly.
What is a high-ratio mortgage in Canada?
A high-ratio mortgage is one where your down payment is less than 20% of the purchase price, so the loan is a high ratio of the home's value. Federal rules require mortgage default insurance (from CMHC, Sagen, or Canada Guaranty) on these mortgages — a one-time premium of roughly 2.8%–4.0% of the loan, usually added to your balance. The trade-off: insured high-ratio mortgages typically get the lowest interest rates.
Why is an insured (high-ratio) mortgage rate often lower than conventional?
Because default insurance protects the lender against loss, an insured mortgage carries almost no risk for them — so they offer their best rates on it. A conventional (uninsured) mortgage isn't backed that way, so lenders sometimes price in slightly more risk. That's why a buyer with under 20% down can occasionally get a lower rate than one with 20% down, even after paying the premium.
Is it better to put down 20% or less?
It depends on your situation. Twenty percent avoids the insurance premium and unlocks conventional flexibility (rentals, higher-value homes, 30-year amortization, refinancing). But less than 20% lets you buy sooner, capture today's price, and get the lowest insured rate. For many buyers, buying now with the minimum down beats spending years saving to 20% while prices and rent climb. Run both ways before deciding.
How much is CMHC mortgage insurance?
The premium is roughly 2.8% to 4.0% of the mortgage amount, with a higher percentage for a smaller down payment — 4.0% at the 5% minimum, decreasing as you approach 20%. It's a one-time cost almost always added to your mortgage balance rather than paid upfront. Our CMHC premium calculator at /cmhc-insurance-calculator shows the exact figure for your down payment.
Can I get mortgage insurance on a refinance or rental?
Generally no. Default insurance is for owner-occupied purchases (1–4 units) priced under $1.5 million. The only insured refinance is a limited CMHC program to build a secondary suite. Other refinances and non-owner-occupied rental properties must be conventional, which is why they require at least 20% (often more) down and can carry slightly higher uninsured rates. Shopping multiple lenders matters most on these uninsured deals.
We’ll try to beat your rate.
If we can’t, we pay you $500.¹
¹ Rate Beat: eligible Big-6 bank written offers only · same product, term & amount · $500 paid to you or your nominated charity at closing · conditions apply
Find a mortgage specialist in your city
Whether you're going high-ratio or conventional, the rate you get depends on which lenders your broker can access. We work with 100+ lenders coast to coast — from the Big Six to monolines and private lenders — and shop your file across all of them.