The baseline maximum amortization for an insured mortgage in Canada is 25 years. This has been the standard for high-ratio insured lending for well over a decade and remains the default position for any insured file that does not fit one of the specific 30-year eligibility paths covered in the previous module: first-time buyer, or buyer of a new build.
Where a file does qualify for the extended amortization, it is not free relative to the 25-year baseline: CMHC applies a 0.20% premium surcharge on top of the applicable base premium rate for insured purchases using the 30-year option, effective for applications from 1 August 2024. A longer amortization lowers the monthly payment, which can meaningfully help a marginal file clear its GDS/TDS ratios, but the tradeoff is a larger insurance premium financed into the loan and materially more interest paid in total over the life of the mortgage — a conversation worth having explicitly with a client who is drawn to the lower payment without having thought through the total-cost side.
An insurable file — 20% or more down, insured on the back end at the lender's cost — is not bound by the borrower-side 25/30-year framework in the same way, because the borrower did not need insurance to qualify in the first place; amortization on these files is set by lender policy, informed by whether the lender ultimately chooses to insure it. An uninsurable file, carrying no default insurance at all, is governed entirely by the individual lender's own amortization policy, which varies by lender and by whether the lender is a bank, monoline, credit union, or alternative lender, and is not fixed by a single national rule the way the insured 25-year default is.
This is precisely why this course teaches by category rather than citing a single lender's specific amortization maximum as a universal fact: a 30-, 35- or even 40-year amortization is achievable in the uninsurable space at some lenders and not others, and that guideline can change without notice.
A separate scenario worth distinguishing from the two above is a blended amortization — typically arising when new money is added to an existing insured mortgage and the remaining amortization on the old balance is blended with a fresh amortization on the new funds to produce a single combined schedule. This triggers its own 0.60% premium surcharge on the increase in loan amount, separate from and in addition to any surcharge tied to exceeding 25 years outright. It shows up most often in portability-with-increase scenarios, covered in the next module, rather than in a straightforward new purchase.
A first-time buyer qualifies for a 30-year amortization on an insured purchase. What is the direct cost consequence, beyond the lower monthly payment?
The 30-year amortization is not priced the same as the 25-year default: CMHC applies a 0.20% surcharge on top of the applicable base premium, and stretching the same balance over more years increases total interest paid even though the monthly payment drops. The price cap and portability are governed by separate rules entirely unaffected by the amortization choice, so tying either of those to the 30-year decision would be incorrect.
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