Uninsured Mortgage

An uninsured mortgage (also called conventional) is one where the borrower has at least 20% down, so no mortgage default insurance is required. Lenders bear the full default risk themselves and pass the underwriting cost through in the form of slightly higher rates than insured mortgages — typically 5 to 25 basis points higher for the same term and lender. Uninsured mortgages give the borrower more flexibility: amortizations up to 30 years, no CMHC premium added to the loan, fewer property-type restrictions (rentals, vacant land, multi-units up to 4 doors). The trade-off is a slightly higher rate and more income-verification scrutiny — without CMHC backing the deal, lenders run their own underwriting more carefully. The distinction between uninsured and insured is purely on the lender side. From the borrower's perspective, an uninsured mortgage looks identical to an insured one — same monthly payment, same paperwork, just no CMHC premium added.