What’s the Difference Between Insured, Insurable, and Uninsurable Mortgages?
Two homeowners. Same income. Same credit score. Same city.
One gets the lowest rate in Canada. The other gets dinged with something way higher.
The difference? Which bucket their mortgage falls into: insured, insurable, or uninsurable.
These labels are how lenders rank risk. Less risk = cheaper money. More risk = higher interest rate.
Similar houses, similar neighborhood, similar income - different rate? What’s going on?
Insured Mortgages
This is the cheapest money you’ll ever get in Canada. This is those advertisements of those nearly too-good-to-be-true rates (no, not talking about teaser rates - and I have lots of thoughts on that matter).
Who it’s for: Anyone buying with less than 20% down, up to a purchase price of $1.5M.
How it works: You pay a one-time insurance premium to CMHC, Sagen, or Canada Guaranty through tacking it on to your mortgage balance (and HST on said insurance premium is paid at closing). That insurance protects the lender, not you.
Your win: The lowest rates on the market.
And once your mortgage is insured, it usually stays insured - as long as you’re only doing a straight transfer at renewal. This means:
No extra funds.
No amortization change.
Just a clean switch to a new lender.
But the second you change the structure, you lose it:
Refinance? Gone.
Add a HELOC? Unfortunately - the restructure removes the insurance.
Extend your amortization? Looked at as a refinance, and yes - it’s gone.
Once you tweak it, your loan slides into the uninsurable bucket until it qualifies again.
2024 update: First-time buyers using insured mortgages can now access up to 30-year amortizations. That’s a big deal for affordability.
And here’s the twist most people miss:
If you’re recently separated or divorced, lenders may treat you as a first-time buyer for amortization purposes. You won’t get the government rebates again (those are one-time perks on your true first purchase), but you can qualify for a 30-year insured amortization.
New builds also qualify for the 30-year insured option - even if you already own another property. The government carved out this exception to encourage housing supply.
So “first-time buyer” isn’t always as black-and-white as it sounds.
Insurable Mortgages
This is the middle ground.
Who it’s for: Buyers with 20%+ down, transfers that now have an amortization up to 25 years
How it works: You don’t pay the insurance premium, but the lender bulk-insures your loan behind the scenes - so the slightly higher rate for the insurable mortgages is for lenders to recoup the costs of bulk insuring (vs you paying for it in insured mortgages).
Your win: Rates better than uninsurable, but not as cheap as insured.
The $1.5M purchase cap still applies. If the home costs more, it can’t be insured - and that pushes it into the uninsurable category.
Uninsurable Mortgages
This is where things gets slightly more expensive.
Who it’s for:
Purchases over $1.5M
Amortizations longer than 25 years (unless you’re a first-time buyer (or recent separation) or new build with insured)
Refinances up to 80% LTV
Rentals and investment properties
Why it costs more: Lenders can’t get insurance on these deals. That means more risk, and you pay for it in higher rates.
Insured vs Insurable vs Uninsurable Mortgages (2025)
| Type | Who Qualifies | Insurance Cost | Rates |
|---|---|---|---|
| Insured | Less than 20% down; purchase price up to $1.5M; stays insured on straight transfers. 30-yr amortization for FTHB, separated/divorced buyers, and new builds. | You pay a premium once | Lowest |
| Insurable | 20%+ down on purchases ≤ $1.5M. | Lender bulk-insures (you don’t pay) | Medium |
| Uninsurable | All refinances (any LTV); purchases > $1.5M; amortizations >25yrs (except FTHB or new build insured); rentals | Not insurable at all | Highest |
The Bottom Line
Insured, insurable, uninsurable - these aren’t just buzzwords. They decide what you’ll pay in interest.
Insured = cheapest, now up to $1.5M with 30-year options for first-time buyers, separated/divorced buyers, and new builds.
Insurable = the middle tier, still competitive.
Uninsurable = the priciest money in the market on the A-side
And remember: your insured status can disappear the second you refinance, restructure, or add a HELOC. That’s why planning before you sign matters.
👉 At VeloMortgage, we’ll show you which bucket you’re in, and how to keep yourself out of the expensive one.
Jeff Dinsmore
Mortgage Broker
FSRA # 10315
TMG - The Mortgage Group
VeloMortgage.ca
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Related articles:
Government of Canada announcement: Delivering the Boldest Mortgage Reforms in Decades (2024)