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If your down payment is less than 20 percent of the lending value or purchase price, whichever is less, your mortgage will be considered a high-ratio mortgage, which usually requires mortgage loan insurance. The insurance insures the lender against default. You, the borrower, pay for this insurance; your lender usually adds the mortgage loan insurance premium to your mortgage, or it can request that you pay it in full on closing. Note that applicable provincial sales tax is charged to the default insurance premium; however, the sales tax will not be added to the mortgage amount — it is payable on closing as part of your closing costs.

There are a couple of insurers that provide mortgage loan insurance: Canada Mortgage and Housing Corporation (CMHC) and Genworth Financial Canada.