A high-ratio mortgage is a type of mortgage where the down payment is less than 20% of the purchase price of the home. This means the loan-to-value (LTV) ratio is higher than 80%.

For example, if you’re buying a home for $500,000 and you put down $50,000 (which is 10%), your mortgage amount would be $450,000. This results in a high-ratio mortgage because the LTV ratio is 90%.

High-ratio mortgages typically require mortgage default insurance (like CMHC insurance in Canada) to protect the lender in case the borrower defaults on the loan. This insurance adds to the overall cost of the mortgage.

*The information provided is for educational purposes only and should not be considered legal advice. For specific legal concerns or questions related to your mortgage, it is always best to consult with a qualified legal professional.*

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