CMHC stands for the Canadian Mortgage and Housing Corporation, which is an agency which assists Canadians who cannot afford housing in the private market.  If the amount of your proposed mortgage will be more than 80% of either the purchase price or the appraised value of the property (whichever is lower), the mortgage is considered high ratio. To comply with legal requirements, you must purchase mortgage insurance, which relates from .5% to 3.75% of value price.  It protects the lender and, by law, most Canadian lending institutions require it.


The cost of this insurance, except for application fees, are generally tacked on top of your mortgage so is not payable in one lump sum.  The application fees required at time of insurance application, which is a one-time cost (approximately $75.00 to $235.00).    Mortgage insurance is available through Canada Mortgage and Housing Corporation (CHMC).  An application fee and an insurance premium will also apply, which you can add to the mortgage amount. More information is available through www.cmhc.ca


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