When a mortgage is insured through CMHC, the insurance premium is primarily determined by the loan-to-value (LTV) ratio. CMHC’s standard premium tables are based on mortgages with an amortization of 25 years or less.
If a borrower selects a 30-year amortization, CMHC applies an additional 0.20% premium surcharge to account for the increased risk associated with a longer repayment period.
Why does CMHC charge more for 30-year amortizations?
A longer amortization increases risk for the insurer because:
The mortgage balance declines more slowly
The insured amount remains higher for a longer time
There is greater long-term exposure to borrower and market risk
Because of this, CMHC prices insured mortgages with 30-year amortizations slightly higher than those with shorter amortizations.
How the 0.20% Surcharge Is Applied
The 0.20% is added to the standard CMHC premium
It applies to owner-occupied properties (1–4 units) under the CMHC Home Start program
The surcharge applies consistently across applicable LTV bands, including scenarios with non-traditional down payments
The premium is a one-time charge and is typically added to the mortgage amount
Example: 15% Down Payment (85% LTV)
Below is a comparison of CMHC premiums for the same borrower and property, with only the amortization changing.
Scenario
Purchase price: $588,235
Down payment (15%): $88,235
Mortgage amount: $500,000
Loan-to-value (LTV): 85%
CMHC Premium Comparison
Amortization | CMHC Premium Rate | Premium Amount |
25 years | 3.10% | $15,500 |
30 years | 3.30% | $16,500 |
Difference:
+0.20% premium
+$1,000 added to the insured mortgage amount
How are the CMHC 30 year amortization rates appled in Finmo?
Finmo automatically applies CMHC’s 30-year amortization premium rates when:
CMHC is selected as the insurer, and
The amortization is set to 30 years
This ensures that the premium shown in Finmo aligns exactly with CMHC’s published premium schedules.
CMHC Reference Links