indicatorHome Buying and Mortgages

What is an insured mortgage?

An insured mortgage is mandatory in Canada if your down payment is less than 20%. Learn about insured mortgages, how much to save for a down payment, insurance providers and more.

By ATB Financial 14 November 2025 2 min read

Whether you’re filling your weekends with open houses, starting to dream about your future home, or somewhere in between, knowing how much you need to save for a down payment gets you one step closer to turning a house (or apartment) into a home. The amount you have set aside for your new place determines whether or not you'll need to opt for an insured mortgage

Here are a few things you should know about insured mortgages, starting with a foundational understanding of down payments:

 

How much do I need for a down payment?

The minimum amount you’ll need for a down payment depends on the price of the home, and there’s no maximum amount. A down payment is paid up front and deducted from the purchase price of your home, while your mortgage covers the remaining cost.

If your new home is less than $500,000, you’ll need to put at least 5% down.

If your home is priced between $500,000 and $1.5 million, you’ll need to put down 5% of the first $500,000 of the purchase price, and 10% for the portion of the price above $500,000. Homes priced at $1.5 million or more require a minimum 20% down payment of the purchase price.

Some borrowers may need a larger down payment for mortgages that lenders see as “higher risk”.

 

Liked what you just read?

Subscribe to On the Money by ATB and get content you’ll actually want to read.

Sign up now

What is an insured mortgage?

An insured mortgage is a mortgage that includes mortgage default insurance. If you put down less than 20% towards the purchase of your home (between 5% and 19.99%), it’s mandatory to buy mortgage default insurance in Canada.

The insurance helps to protect the lender in case you’re unable to make your mortgage payments because of default or foreclosure. The cost of your insurance is based on a percentage of your total mortgage amount. The bigger your down payment, the less you’ll pay for mortgage default insurance.

 

Are all mortgages insured?

No. If you make a down payment of at least 20%, you’ll qualify for a conventional mortgage, which doesn’t require insurance. If you make a down payment of less than 20%, you’ll have to get an insured mortgage.

 

Who insures mortgages in Canada?

In Canada, mortgages are insured through three private insurers: Canada Mortgage and Housing Corporation (CMHC, a federal Crown corporation), Sagen or Canada Guaranty. The lender typically chooses the insurance company on your behalf, so you don’t have to make the decision.

While it’s ideal to put 20% down on your home, a benefit of an insured mortgage is that it can help you become a homeowner sooner.

 

A mortgage specialist can partner with you as you search for your dream home, sharing the advice you need to pick your best option.

You might be interested in

Need help?

Our Client Care team will be happy to assist.

1-800-332-8383