Question Period Note: Mortgage Insurance Programs

How are the Canada Mortgage and Housing Corporation mortgage insurance programs promoting housing affordability and supporting an efficient and competitive housing finance market for Canadians?

• This government understands that saving a 20% down payment is difficult for many Canadians. Mortgage loan insurance is an essential tool that allows Canadians to buy a home at interest rates that are comparable to those who have a higher down payment.

• Canada Mortgage and Housing Corporation’s (CMHC) mortgage loan insurance programs help Canadians across the country access homeownership while also supporting the stability of the housing market.

• As the only provider of mortgage loan insurance for multi-unit residential properties in Canada, CMHC is helping to drive growth in housing supply by providing developers and builders with access to preferred interest rates for the construction, purchase, and refinancing of multi-unit residential properties.

• Canada Mortgage and Housing Corporation (CMHC) is working with mortgage industry professionals to help homebuyers meet their housing needs and to provide a full range of mortgage loan insurance products for homeowner and multi-unit properties. CMHC sets its premiums and retains enough capital to absorb any potential losses without the need for government support.

• Benefits of CMHC’s mortgage loan insurance for Canadian homebuyers include access to homeownership with a minimum down payment of 5%, access to competitive interest rates, flexible terms and conditions to meet a variety of financing needs and products, training, solutions, and service available everywhere in Canada.

• Budget 2024 announced the Government of Canada’s intention to make targeted changes to mortgage insurance rules to encourage densification and support the efficient functioning of the housing finance market, by enabling homeowners to add more units to their homes.

• On January 15, 2025, new insured mortgage refinancing products became available specifically for homeowners looking to add secondary suites to their existing home. The mortgage insurance home price limit was increased to $2 million for those refinancing to build a secondary suite, to increase the number of homeowners that can access this refinancing in housing markets across the country.

• Effective December 15, 2024, the federal government increased the insured mortgage price cap from $1 million to $1.5 million, and additionally, made 30-year amortizations available to all first-time home buyers and buyers of any new builds, lowering monthly mortgage payments. These reforms, part of the Canadian Mortgage Charter, also allow insured mortgage holders to switch lenders at renewal without another stress test.

• For developers, Mortgage Loan Insurance Select is an innovative multi-unit mortgage loan insurance product focused on affordability, accessibility, and climate compatibility. It offers access to reduced premiums and longer amortization periods based on the development’s level of commitment to affordability, accessibility, and climate compatibility, increasing the supply of affordable housing across the country.

• Budget 2023 announced the federal government’s intention to deliver a separate insurance subsidy for households at high risk of flooding. Budget 2024 reaffirmed the federal government’s commitment to National Flood Insurance with the intention to establish a subsidiary of CMHC to deliver flood reinsurance, and $15 million to the CMHC in 2025-26 as well as working with provinces, territories and industry to advance implementation of a national flood insurance program by 2025.

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