How does mortgage insurance enable lower down payments?

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### Scenario: Sarah's First Condo
Consider Sarah, who is purchasing her first condo for $400,000. Here is how mortgage insurance impacts her required upfront savings:

| Scenario | Down Payment % | Required Savings | Loan-to-Value (LTV) |
|---|---|---|---|
| Without Insurance | 20% | $80,000 | 80% |
| **With Insurance** | **5%** | **$20,000** | **95%** |

| Loan-to-Value (LTV) | Minimum Equity Requirement | Max Purchase Price/Lending Value  |
|-----------------------|-----------------------------|------------------------------------|
| Up to 95% (1-2 units) | 5% of first $500k, 10% remainder | < $1,500,000                       |
| Up to 90% (3-4 units) | 10%                         | < $1,000,000                       |
| Up to 80%            | 20%                         | < $1,000,000 or < $2,000,000 (Refinance)|

How does mortgage insurance enable lower down payments?

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2026 Insured Mortgage Advantage: 5% Down Payment, Three Insurers & Best Rates Explained

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How does mortgage insurance enable lower down payments?

Key Points

Need a Deeper Breakdown?

Technical Research Verification

2026 Insured Mortgage Advantage: 5% Down Payment, Three Insurers & Best Rates Explained

Related Questions

How will lenders evaluate my debt service ratios, and what key factors are considered?

What property considerations impact my mortgage application?

How does the 'straight switch' exemption benefit you at renewal?

What are Loan-to-Income (LTI) limits and how will they affect institutional mortgage portfolios?