How much down payment do you need for a Canadian mortgage?

By Canadian Rates editorial team · Last reviewed May 1, 2026

The federal minimum down payment in Canada is tiered:

• 5% on the first $500,000 of purchase price.
• 10% on the portion between $500,000 and $1,500,000.
• 20% on any portion above $1,500,000 (no insured mortgages above this threshold).

So a $700,000 home requires (500,000 × 5%) + (200,000 × 10%) = $45,000 minimum down. A $1,400,000 home requires (500,000 × 5%) + (900,000 × 10%) = $115,000. The tool below applies these tiers automatically.

The 20% question is the real decision

If you put down less than 20%, your mortgage is insured — you pay a CMHC (or Sagen, or Canada Guaranty) premium that ranges from 2.8% to 4.0% of the loan amount, financed into the mortgage. On a $500,000 mortgage at 4% premium, that’s $20,000 added to your loan.

But — and this is the trade-off most people miss — insured mortgages get the lowest rates in the market. Lenders price insured mortgages tighter because the insurer takes the default risk. So putting down exactly 20% can mean paying a higher interest rate than someone who put down 19.99%.

For a typical $500,000 mortgage, the insured-vs-uninsured rate gap (often 0.20–0.40 percentage points) costs roughly $4,000–$8,000 in extra interest over a 5-year term. The CMHC premium on the same loan is closer to $14,000–$20,000. So uninsured (20%+ down) usually wins on total cost, but the gap is smaller than people think — and shrinks further at smaller loan sizes.

See insured vs uninsured rate tiers for the full breakdown.

Three scenarios where less than 20% is the right call

1. You’d be drained of liquidity. Putting every dollar into the down payment, then having no emergency fund, is worse than a CMHC premium. Aim to keep 3–6 months of mortgage payments accessible after closing.
2. You’d be giving up a registered-account top-up. Maxing your FHSA before scaling the down payment past 20% usually beats the after-tax cost of the CMHC premium.
3. The home will appreciate before you’d realistically save 20%. Buying at 5% down today often beats waiting 18 months to put 20% down on a more expensive house.

The CMHC premium is the cost of buying earlier with less cash. Sometimes that’s the right cost to pay.