Mortgage default insurance protects lenders, from losses in the event of a default on a mortgage by the borrower and is required for all mortgages where the down payment is less than 20% of the property value. It is offered by three mortgage insurance providers in Canada, the Canada Mortgage Housing Corporation (CMHC), Canada Guaranty, and Genworth Financial. Saving up for a down payment is difficult but mortgage default insurance grants buyers the opportunity to purchase homes with a down payment of 5% of the value of the property. This allows a greater number of people access to the property market, which helps to keep the housing market stimulated and active. The total cost of your mortgage default insurance is calculated based on the size of your mortgage loan, and is typically in the range of 2.50% and 4.00% although it can be outside of those values. Since your down payment defines the size of the loan, you have an incentive to have a larger down payment. The smaller your down payment is, the larger your mortgage loan and mortgage default insurance will be. Paying your mortgage default insurance is usually done in installments, and can be paired with your mortgage loan repayments, but can also be paid off in a lump sum.