Short answer
For insured Ontario mortgages, the CMHC premium may be added to the mortgage, but Ontario PST on that premium is normally a cash closing cost. Buyers who only look at mortgage payment estimates can miss this closing-day cash requirement.
Premium split worksheet
Premium versus PST
This is one of the easiest costs to miss because it is connected to the mortgage but still affects closing cash.
What this page helps you decide
Buyer wants to estimate CMHC mortgage insurance and the Ontario PST cash item at closing.
- Minimum down payment and insured threshold are checked.
- Premium rate tiers are estimated by loan-to-value.
- Ontario PST on the premium is added to the cash-to-close ledger.
Documents to check
Where to find the answer
The goal is to replace rough assumptions with document-backed numbers before closing.
Mortgage approval
Confirms loan amount, amortization, insurer, and whether the premium is added to the mortgage.
Down payment proof
The down payment percentage drives the loan-to-value tier.
Lawyer's closing estimate
Shows whether the provincial sales tax on the premium is included in the cash request.
Purchase price and deposits
Needed so the calculator can separate down payment still owing from insured-mortgage costs.
How CMHC premium tiers work
CMHC publishes premium rates by loan-to-value. The higher the share of the purchase price being borrowed, the higher the premium rate can be.
Why Ontario PST is treated differently
CMHC states that premiums in Ontario are subject to provincial sales tax and that the provincial sales tax cannot be added to the loan amount. That makes it a cash-to-close item.
Why this is only one ledger line
A buyer can understand CMHC PST perfectly and still miss land transfer tax, rebate timing, legal/title costs, builder adjustments, or development charges. The full calculator keeps those items together.
Common mistakes
What buyers often miss
Thinking financed premium means no cash impact
The premium and the PST are different. The premium may be financed, while the PST usually needs to be paid in cash.
Using the wrong down-payment tier
A small change in down payment can move the loan-to-value tier and change the premium.
Forgetting insured limits
Not every mortgage is insurable. The calculator treats insured-mortgage costs as a planning estimate, not a lender approval.
Example CMHC PST estimate
| Purchase price | $900,000 |
|---|---|
| Down payment | $90,000 |
| Estimated premium | $25,110 |
| Ontario PST cash item | $2,009 |
Source-linked claims
What this page relies on
CMHC says the mortgage loan insurance premium is calculated as a percentage of the loan and based on down payment size.
CMHC lists premium rates by loan-to-value tier, including 4.00 percent for 90.01 percent to 95 percent loan-to-value with a traditional down payment.
CMHC states that premiums in Ontario are subject to provincial sales tax and that provincial sales tax cannot be added to the loan amount.
Frequently asked
Is CMHC insurance PST financed into the mortgage?
The insurance premium is commonly added to the mortgage, but Ontario PST on that premium is usually due in cash at closing.
Does every buyer pay CMHC insurance?
No. It depends on purchase price, down payment, and whether the mortgage is insured.