Short answer: For an eligible owner-occupied home purchase in Alberta, mortgage default insurance is generally required with less than 20% down; lender and insurer approval still apply. The premium is a percentage of your mortgage: 4.00% with 5% down, 3.10% with 10% down and 2.80% with 15% down. It's usually added to your mortgage rather than paid in cash, and Alberta doesn't charge sales tax on it. On a $500,000 home with 5% down, that's $19,000 added to a $475,000 mortgage.
By Jay Lewis, REALTOR® | RE/MAX Excellence · Updated October 22, 2026
Free download: my New-Construction Buyer Checklist. Two printable pages, from your first show home visit to your one-year warranty, including the money questions to settle with your lender before you sign.
I've worked in new construction for more than 25 years, on the trades side and the sales side, and the question I hear most from first-time buyers isn't about floor plans. It's "how much do I really need to have saved?" Mortgage insurance is a big part of that answer, so here's how it works in Alberta, with real numbers.
What is mortgage insurance?
Mortgage insurance (also called mortgage default insurance) protects your lender, not you, if you stop making payments. In exchange, it lets you buy with less than 20% down. In Canada it's provided by CMHC, Sagen and Canada Guaranty. Your lender arranges it, and you pay the premium.
It isn't the same as mortgage life insurance, which pays off your mortgage if you die. That's optional. Mortgage default insurance is required when you put less than 20% down.
How much does mortgage insurance cost in Alberta?
The premium depends on how much you borrow compared with the price, which lenders call loan-to-value. These are CMHC's premiums on the total loan:
5% to 9.99% down: 4.00% of the mortgage
10% to 14.99% down: 3.10%
15% to 19.99% down: 2.80%
20% or more down: no insurance needed on a regular purchase
Here's what that looks like on a $500,000 home, using a hypothetical purchase price rather than a current market average:
5% down ($25,000): $475,000 mortgage, $19,000 premium, $494,000 total borrowed
10% down ($50,000): $450,000 mortgage, $13,950 premium, $463,950 total borrowed
15% down ($75,000): $425,000 mortgage, $11,900 premium, $436,900 total borrowed
Prices change often with market conditions and world events, so treat these as examples, not a quote. For this week's numbers, see my Edmonton market update.
Do you pay mortgage insurance up front?
Usually not. The premium is added to your mortgage and paid off with your regular payments. In Ontario, Quebec and Saskatchewan, buyers pay provincial sales tax on the premium in cash at closing. Alberta has no provincial sales tax, so there's nothing extra to bring to the lawyer for it.
What's the minimum down payment in Alberta?
Up to $500,000: 5% of the price
$500,000 to $1.5 million: 5% of the first $500,000, plus 10% of the amount above that
$1.5 million or more: 20%, and the mortgage can't be insured
So a $600,000 home needs at least $35,000 down: $25,000 on the first $500,000 and $10,000 on the next $100,000. The insured price cap went from $1 million to $1.5 million in December 2024.
Does a 30-year mortgage cost more to insure?
Yes. Since December 2024, first-time buyers and anyone buying a new build can get a 30-year amortization on an insured mortgage. CMHC adds 0.20% to the premium when you choose 30 years, so 5% down goes from 4.00% to 4.20%. On the $475,000 example, that's $19,950 instead of $19,000. A longer amortization can reduce monthly payments, but increases total interest at the same rate. Ask your lender to compare both options. I go through the trade-offs in Can You Get a 30-Year Mortgage in Alberta?How can you reduce or avoid the mortgage insurance premium?
Put 20% down. On a $500,000 home that's $100,000, which is a lot, but it removes the premium completely.
Move up a tier. Going from 9% to 10% down drops the rate from 4.00% to 3.10%. Ask your lender to run the numbers at each tier.
Use the savings programs. An FHSA and the RRSP Home Buyers' Plan can help you reach a bigger down payment faster.
Look at the total cost, not just the price. On a new build, the first-time buyers' GST rebate can save far more than the premium. See GST rebate on new homes in Alberta.
Get my free New-Construction Buyer Checklist
Two printable pages covering every stage from your first show home visit to your one-year warranty.
Frequently asked questions
Is mortgage insurance required in Alberta?
Yes, when your down payment is less than 20% of the purchase price.
How much is CMHC insurance with 5% down?
4.00% of the mortgage, or 4.20% with a 30-year amortization. On a $475,000 mortgage that's $19,000, or $19,950 over 30 years.
Can I pay the premium in cash instead?
Some lenders allow it, but most buyers add it to the mortgage. Ask your lender which works better for you.
Is mortgage insurance refundable if I sell?
Not as a refund. Some insurers let you carry it to your next home for a reduced premium. Ask your lender about portability before you sell.
Working out your budget?
Text me first at 780-220-8449, or book a 20-minute call. I'll put the price, down payment, insurance and closing costs side by side so you know your real number before you shop. I work with buyers in Edmonton, Sherwood Park, Fort Saskatchewan, Devon, Spruce Grove and Stony Plain. I'm not a mortgage broker, and I'll connect you with one for your rate and approval. I also list homes for some builders. If you're interested in one of those, I'll tell you up front and explain how representation works.
Jay Lewis | REALTOR® | RE/MAX Excellence
Sources:CMHC: mortgage loan insurance cost · Department of Finance Canada: mortgage reforms in force, December 2024 · CMHC: 30-year amortization premium notice
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This article is general information, not legal, tax or mortgage advice. Prices, premiums and rules are estimates that change often with market conditions and world events. Confirm the details with your lender before you buy.
