Canadian mortgage rules for 2026: down payment, CMHC and the stress test
The rules that decide how much you need to put down, what mortgage insurance costs, how long you can amortize and how lenders test whether you qualify.
How much you need to put down
The rule has two steps. You need 5% of the first $500,000 of the purchase price and 10% of the portion from $500,000 up to $1.5 million. Homes priced at $1.5 million or more need at least 20% down. With less than 20% down, mortgage default insurance from CMHC, Sagen or Canada Guaranty is required, and the premium is added to the mortgage.
| Home price | Minimum down payment | Mortgage before insurance | CMHC premium rate | Premium | Total insured mortgage |
|---|---|---|---|---|---|
| $400,000 | $20,000 (5.00%) | $380,000 | 4.00% | $15,200 | $395,200 |
| $500,000 | $25,000 (5.00%) | $475,000 | 4.00% | $19,000 | $494,000 |
| $600,000 | $35,000 (5.83%) | $565,000 | 4.00% | $22,600 | $587,600 |
| $750,000 | $50,000 (6.67%) | $700,000 | 4.00% | $28,000 | $728,000 |
| $900,000 | $65,000 (7.22%) | $835,000 | 4.00% | $33,400 | $868,400 |
| $1,000,000 | $75,000 (7.50%) | $925,000 | 4.00% | $37,000 | $962,000 |
| $1,250,000 | $100,000 (8.00%) | $1,150,000 | 4.00% | $46,000 | $1,196,000 |
| $1,499,000 | $124,900 (8.33%) | $1,374,100 | 4.00% | $54,964 | $1,429,064 |
In Ontario, provincial sales tax applies to the insurance premium and must be paid in cash at closing; it cannot be added to the mortgage.
What CMHC insurance costs
| Down payment | Premium (% of the mortgage) |
|---|---|
| 5% to 9.99% | 4.00% |
| 10% to 14.99% | 3.10% |
| 15% to 19.99% | 2.80% |
| 20% or more | Not required |
How long you can amortize
Insured mortgages are limited to 25 years, except for first-time buyers and buyers of newly built homes, who can choose 30 years. Mortgages with 20% or more down can usually be amortized up to 30 years.
The stress test
Federally regulated lenders must qualify you at the higher of your contract rate plus 2 percentage points or 5.25%. If you are offered 4.5%, you must show you could afford payments at 6.5%. Your housing costs (GDS) generally must stay at or below 39% of gross income, and all debts (TDS) at or below 44%, for insured mortgages.
Monthly payments at different rates
Canadian fixed-rate mortgages are compounded semi-annually under the Interest Act, which makes payments slightly lower than a US calculator shows at the same rate.
| Rate | $100,000 over 25 yrs | $100,000 over 30 yrs | $500,000 over 25 yrs | $500,000 over 30 yrs |
|---|---|---|---|---|
| 3.5% | $499.27 | $447.64 | $2,496 | $2,238 |
| 4.0% | $526.02 | $475.52 | $2,630 | $2,378 |
| 4.5% | $553.47 | $504.22 | $2,767 | $2,521 |
| 5.0% | $581.60 | $533.69 | $2,908 | $2,668 |
| 5.5% | $610.39 | $563.91 | $3,052 | $2,820 |
| 6.0% | $639.81 | $594.82 | $3,199 | $2,974 |
| 6.5% | $669.82 | $626.40 | $3,349 | $3,132 |
Help for first-time buyers
If you've never owned a home, use the FHSA first: you can put in up to $8,000 a year ($40,000 in total), deduct it from your income and take it out tax-free for the purchase. The RRSP Home Buyers' Plan lets you borrow up to $60,000 from your own RRSP and pay it back over 15 years. At tax time there's a first-time home buyers' tax credit worth up to $1,500, and in Ontario you can get up to $4,000 of land transfer tax refunded.
Calculate your payment with Canadian compounding, accelerated bi-weekly payments and prepayments.
Open the Canadian Mortgage CalculatorRelated tools: Down Payment Calculator, House Affordability Calculator, Mortgage Calculator and Rent vs Buy Calculator.
Frequently asked questions
Can I buy a $1.4 million home with less than 20% down?
Yes. Since December 2024, insured mortgages are available on homes priced under $1.5 million, with 5% on the first $500,000 and 10% on the rest.
Is CMHC insurance the same as life insurance?
No. It protects the lender if you default. Mortgage life insurance is separate and optional.
Do credit unions apply the stress test?
Provincially regulated lenders are not bound by the federal rule, but most apply a similar test.