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What the CMHC premium actually costs you

The premium is the part of an insured file borrowers ask about first and understand last. Here is the mechanism, without a table that goes stale.

The short answer

The insurance premium is a real cost of an insured file, but it is almost always added to the loan rather than paid in cash, so it shows up as a slightly larger mortgage rather than a cheque at closing. On MLI Select the premium is discounted according to the social outcome points the project achieves, so the same building can carry a different premium depending on what you commit to.

  • The premium is charged on the insured loan amount and is normally capitalised into the loan.
  • It scales with leverage and amortization, so the things that make an insured file attractive also make the premium larger.
  • On MLI Select, achieving more points reduces the premium as well as unlocking higher leverage and longer amortization.
  • CMHC publishes the current schedule itself and the numbers move, so we quote from their document at the time rather than from a page like this one.
Halftone illustration of an apartment building inside a shield.

Why the premium is not the number to optimise

The premium is a real cost and it deserves a line in your model. It is also, on most qualifying files, smaller in effect than the leverage and the amortization it buys. The insured structure is what lifts the coverage, and the coverage is what sets the loan.

The worked example on our commercial mortgage calculator runs the same building down the conventional path and the insured path side by side. Look at the gap between the two loan amounts before you decide the premium is the problem.

The honest warning is this. A borrower fixated on avoiding the premium can talk themselves into a much smaller loan and a much larger equity cheque, and then wonder why the deal no longer works. Optimise the structure, then price the premium inside it.

What moves the premium on your file

Loan to value. The premium rate rises with leverage. Pushing the loan up is the single largest driver of the premium, and it is also the reason most borrowers are on the insured path at all.

Amortization. A longer amortization carries a higher premium. It also lowers the annual debt service, which lifts the coverage and therefore the proceeds. The two move together on purpose.

New construction or existing property. The premium treatment differs between a building already standing and a project being built, and a construction file carries its own sequence through to the insured takeout.

Points achieved on MLI Select. More points reduce the premium. The same commitments that get you there also raise the leverage and the amortization ceiling, which is why the levers on this page keep pointing at each other.

The MLI Select discount is tied to the same points that set your tier

MLI Select scores a project on affordability, energy efficiency and accessibility. Those points set the tier, and the tier is what unlocks higher leverage and a longer amortization. The premium discount runs off the same score. You are not choosing between a better structure and a cheaper premium. You get both from the same commitments, or neither.

That makes the points work the highest value hour on the file. Affordability points turn on the rents you commit to and how long you hold them. Energy points turn on modelled performance against a baseline. The MLI Select points estimator gives you a read on where a project lands before anyone commits to anything.

Where to get the actual number

CMHC publishes its own multi unit fees and premiums document and updates it. That document is the authority, not a broker page. Effective 14 July 2025 CMHC standardised the premium structure across all multi unit products, including MLI Select, and introduced a premium discount schedule for MLI Select tied to social outcomes.

We deliberately do not reproduce the schedule here. The same reasoning applies to our rates page, which works in spreads over published benchmarks rather than fixed numbers that rot. When we size your file we quote the premium in force on that day against your actual leverage, amortization and points, and we show it inside the loan rather than beside it.

CMHC is an insurer, not a lender. The premium is paid to CMHC through the lender for the insurance coverage, and the loan itself still comes from a lender we place it with. The wider mechanics sit on our CMHC insured financing page.

FAQ

Premium questions.

Almost never. On a normal insured file the premium is added to the loan and financed over the amortization, so it changes the size of your mortgage rather than the size of the cheque you write at closing. Paying it in cash is possible on some structures, and it is worth asking about only if you have surplus cash and no better use for it. Provincial sales tax treatment on insurance premiums is a question for your accountant.

No. The premium buys insurance coverage for the lender on that loan, and it is not returned to you when the property sells or when the loan is repaid early. What can carry value forward is the insurance itself, because an insured loan can sometimes be assumed by a buyer or the coverage can be extended on a later transaction with CMHC's agreement. That is a reason to raise the question early rather than at the closing table.

The premium is charged on the insured loan amount, so a larger loan does mean a larger dollar premium, and the rate applied also rises with leverage and with a longer amortization. What matters is the net effect. The extra proceeds and the longer amortization usually outweigh the extra premium, which is why very few borrowers who qualify for an insured structure choose a smaller conventional loan to avoid it.

On a purpose built rental file that qualifies, usually yes, because the insured path is what buys the higher leverage and the longer amortization in the first place. The honest test is your own plan. If you are holding the asset and the coverage supports the debt, the premium is a cost of a structure you want. If you are buying to reposition and sell inside a short window, run the numbers against a conventional or bridge structure before you commit.

From CMHC directly. They publish a multi unit fees and premiums document and they update it, which is exactly why this page does not reproduce a table. Effective 14 July 2025 CMHC standardised the premium structure across all multi unit products including MLI Select and introduced a premium discount schedule for MLI Select tied to social outcomes. When we size your file we quote the premium in force at that moment against your specific leverage, amortization and points.
Keep reading

Related reading

MLI Select financingThe program, the tiers and what it takes to qualify a BC project.MLI Select points estimatorEstimate points and tier across affordability, energy and accessibility.CMHC insured financing in BCWhy insured pricing sits inside conventional pricing, and what insurance buys.MLI Select for new constructionThe construction loan, the insured takeout and the rental achievement period.

Want the premium priced on your actual structure?

Send the unit mix, the rent plan and the energy target. We will size the file and quote the current premium inside it.

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