By Josh Tagg, mortgage broker · Mortgages for Less with INDI Mortgage · Calgary, serving all of Alberta ·
Budget 2026, tabled November 5, 2026, proposes to raise the price limit for low-ratio (“insurable”) mortgages from $1 million to $1.5 million. It also proposes to allow 30-year amortizations on these mortgages when at least one borrower is a first-time buyer or the home is newly built. Until now, insurable pricing didn’t apply to homes worth more than $1 million or to 30-year purchases. Those buyers paid uninsurable rates, up to 0.40 points higher on November 7, 2026 broker rate sheets. Ottawa has not set an effective date.
Here’s Josh on what changed, in under two minutes.
What exactly did Budget 2026 propose?
On page 208, the budget proposes to “raise the home price limit for optional mortgage insurance from $1 million to $1.5 million and permit 30-year amortisations for these insured mortgages, provided that at least one borrower is a first-time home buyer or the home is newly built.” The stated reason: it “would encourage greater competition between lenders.”
“Optional” insurance is low-ratio insurance, on mortgages with 20% or more down. If the file would otherwise qualify for insurance, a monoline lender can insure it in bulk and pay the premium itself. You pay nothing extra, and the lender can offer a slightly better rate. That file is insurable. A file that falls outside the rules is uninsurable, and it costs more.
| Rule | Today | Budget 2026 proposal |
|---|---|---|
| Maximum home value | Under $1,000,000 | $1,500,000 |
| Maximum amortization | 25 years | 30 years if a first-time buyer or a new build |
| Purpose | Purchase, or a switch to a new lender with no new money | Not changed in the budget |
| Refinance | Not eligible | Not changed in the budget |
| Debt ratios | GDS 39%, TDS 44% at the qualifying rate | Not changed in the budget |
| Effective date | In force | Not announced |
Today’s rules come from section 6 of the federal Eligible Mortgage Loan Regulations. For buyers with less than 20% down, Ottawa already moved the cap to $1.5 million and opened 30 years to first-time buyers and new builds on December 15, 2024. This brings the 20%-down side up to match.
Why does this matter for monoline lenders?
Monoline lenders like First National, MCAP and RFA only do mortgages, through brokers. Bulk insurance is how they price their best rates on 20%-down files. Until now, a 20%-down buyer on a $1.1 million home in Ottawa or Toronto couldn’t get that pricing. Neither could a first-time buyer anywhere who wanted 30 years. Both got uninsurable rates, where the monolines are weakest and the big banks have the field mostly to themselves.
Bringing those files into insurable territory lets the monolines compete for them on equal footing. More lenders bidding on the same mortgage means sharper rates. That’s good for everyone.
How much is the rate gap today?
These are 5-year fixed rates from broker rate sheets on file. MCAP’s is dated November 7, 2026. RFA’s was effective November 5 and First National’s October 30, 2026. Rates change often, so treat them as a snapshot, not a quote.
| Lender | Insured (under 20% down) | Insurable, 35%+ down | Insurable, 20% down | Uninsurable |
|---|---|---|---|---|
| MCAP (Nov 7) | 4.74% | 4.74% | 4.94% | 5.14% |
| RFA, standard (Nov 5) | 4.89% | 4.89% | 5.09% | 5.29% |
| First National (Oct 30) | 4.89% | 4.94% | 5.19% | 5.20% |
Two things stand out. First, your down payment moves the insurable rate more than insurance does. At 35% down or more, insurable pricing usually matches the insured rate, and it beat uninsurable by 0.26 to 0.40 points on these sheets. At exactly 20% down, insurable sits a little higher, and the gap to uninsurable shrinks to between 0.01 and 0.20. Second, the same tiers apply when you switch lenders at renewal. A homeowner whose balance is now 60% of the home’s value gets the 35%-down rate.
What does that mean in dollars?
Using the MCAP sheet, monthly payments, Canadian semi-annual compounding:
| Buyer | Mortgage | Payment at 5.14% | Payment insurable | Saved per month | Interest saved over 5 years |
|---|---|---|---|---|---|
| First-time buyer, $600,000 home, 20% down, 30 years | $480,000 | $2,601.97 | $2,544.55 (4.94%) | $57 | about $4,670 |
| $1,250,000 home, 20% down, 25 years | $1,000,000 | $5,896.00 | $5,781.94 (4.94%) | $114 | about $9,620 |
| $1,250,000 home, 35% down, 25 years | $812,500 | $4,790.50 | $4,606.01 (4.74%) | $185 | about $15,620 |
The first row is where Alberta buyers feel this. Today a first-time buyer in Calgary or Edmonton with 20% down who wants 30 years gets uninsurable pricing at any price. Under the proposal, that file becomes insurable.
Who does this help, and who doesn’t it?
- Helps: buyers with 20% or more down on homes from $1 million to $1.5 million, which are common in Ottawa, Toronto and the GTA.
- Helps: first-time buyers and new-build buyers at any price who want 30 years with 20% down.
- Helps: homeowners on $1 million to $1.5 million homes who switch lenders at renewal with no new money. Today they’re stuck with uninsurable pricing.
- Doesn’t help: refinances, homes over $1.5 million, or single-unit rentals. None of those is eligible today, and the budget doesn’t change that.
When does this not apply?
Not yet. This is a proposal: the regulations still have to be amended, and there’s no start date. Until then the $1 million cap and 25-year limit stand. Buying from $1 million to $1.5 million this winter? Plan on uninsurable pricing and have your broker watch for the change before your rate is set.
Insurable isn’t always cheapest, either. At 20% down, one lender above priced insurable and uninsurable 0.01 apart, and a bank’s uninsured special can still win. A switch also can’t stretch the amortization or add to the balance. Adding money is a refinance, and refinances aren’t insurable.
Frequently asked questions
What is the insurable mortgage limit in Canada after Budget 2026?
Budget 2026 proposes $1.5 million for low-ratio (20%+ down) insurable mortgages, up from $1 million. The change is not in force yet, and no effective date has been announced.
Can I get a 30-year amortization with 20% down?
Yes, but today only as an uninsurable mortgage, which usually carries a higher rate. Budget 2026 proposes to allow 30 years on insurable mortgages when at least one borrower is a first-time buyer or the home is newly built.
What is the difference between insured and insurable mortgages?
Insured mortgages have less than 20% down, and the borrower pays the insurance premium. Insurable mortgages have 20% or more down and would otherwise qualify for insurance, so a monoline lender can insure them in bulk at its own cost and offer a slightly better rate. With 35% or more down, the insurable rate is usually the same as the insured rate.
When does the $1.5 million insurable cap take effect?
The budget does not say. The federal regulations have to be amended first. Until then, the $1 million limit and 25-year maximum still apply.
For more on the 30-year question, see 25 vs 30 years for first-time buyers.
Buying between $1 million and $1.5 million, or a first-time buyer with 20% down who wants 30 years? I’ll show you insurable and uninsurable pricing side by side and tell you whether waiting for this change is worth it.
This is commentary, not advice. Budget measures are proposals until the regulations are amended. Rates are from dated broker rate sheets (October 30 to November 7, 2026) and are not offers; figures as of November 7, 2026.
