Mortgage insurance is a type of insurance that protects lenders in the event that a borrower defaults on their mortgage. In Canada, mortgage insurance is typically required for home buyers who have a down payment of less than 20% of the purchase price of the home.

There are two main types of mortgage insurance in Canada: private mortgage insurance (PMI) and mortgage default insurance (MDI). Private mortgage insurance is offered by private insurance companies and is typically required for home buyers who have a down payment of less than 20% and are not eligible for mortgage default insurance. Mortgage default insurance, also known as Canada Mortgage and Housing Corporation (CMHC) insurance, is offered by the government and is required for home buyers who have a down payment of less than 10%.

Mortgage insurance is an important consideration for home buyers in Canada, as it can significantly affect the overall cost of a mortgage. It is important to carefully consider the cost of mortgage insurance and how it fits into your overall financial plan when buying a home.

There are a few key things to consider when it comes to mortgage insurance in Canada:

1. Cost: The cost of mortgage insurance can vary depending on the size of the down payment, the type of mortgage insurance, and the lender. It is important to carefully consider the cost of mortgage insurance and how it fits into your overall financial plan.
2. Eligibility: In order to be eligible for mortgage insurance, home buyers must meet certain criteria. This includes having a good credit score and being able to demonstrate that they have the financial means to make the mortgage payments.
3. Coverage: Mortgage insurance covers the lender in the event that the borrower defaults on their mortgage. It is important to carefully review the terms of the mortgage insurance policy to understand what is covered and what is not.
4. Cancellation: In some cases, mortgage insurance can be cancelled once the borrower has built up enough equity in their home. It is important to understand the requirements for cancelling mortgage insurance and how to go about doing so.

Overall, mortgage insurance is an important consideration for home buyers in Canada who have a down payment of less than 20%. It is important to carefully consider the cost and terms of mortgage insurance and how it fits into your overall financial plan when buying a home.