30-Year Amortization Rules in Canada 2025 (New Rules)

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Canada expanded access to 30-year amortization in August 2024. Here's who qualifies and what it means.

For years, insured mortgages in Canada (those with less than 20% down payment) were capped at 25-year amortization. In August 2024, the federal government expanded access to 30-year amortization for specific categories of buyers. Here's everything you need to know.

What Changed in August 2024

Effective August 1, 2024, the following borrowers became eligible for 30-year amortization on CMHC-insured mortgages:

First-time home buyers purchasing any residential property (new or resale)
All buyers purchasing newly constructed homes (regardless of first-time buyer status)

Before August 2024: 30-year amortization was only available for uninsured mortgages (20%+ down payment). Insured buyers were capped at 25 years.

After August 2024: First-time buyers and new construction buyers can access 30-year amortization with as little as 5% down.

Who Qualifies for 30-Year Amortization?

Buyer Type	Property Type	30-Year Available?
First-time buyer	Any residential property	Yes
Any buyer	New construction	Yes
Repeat buyer	Resale home	No (still 25-year max)
Any buyer (20%+ down)	Any property	Yes (no insurance required)

30-Year vs. 25-Year Amortization: Payment Comparison

Mortgage Amount	Rate	25-Year Payment	30-Year Payment	Monthly Savings
$400,000	5.00%	$2,326	$2,147	$179
$500,000	5.00%	$2,908	$2,684	$224
$600,000	5.00%	$3,490	$3,220	$270
$700,000	5.00%	$4,071	$3,757	$314

The True Cost of 30-Year Amortization

Lower monthly payments come at a cost: significantly more total interest paid over the life of the mortgage.

Mortgage	Rate	Total Interest (25 yr)	Total Interest (30 yr)	Extra Interest
$500,000	5.00%	$372,400	$466,240	+$93,840
$600,000	5.00%	$446,880	$559,488	+$112,608

When Does 30-Year Amortization Make Sense?

Despite the extra lifetime interest cost, 30-year amortization can make sense in these situations:

Cash flow is tight: Reducing monthly payments by $180–$300 can be the difference between affording a home and not
You expect income to grow: Today's tighter budget will be less constraining in 5–10 years, and you can accelerate payments later
Qualifying for a larger mortgage: The lower payment at the qualifying rate improves your GDS/TDS ratios, allowing you to qualify for a higher loan amount
Alternative uses of savings: If the monthly payment difference is invested at a rate higher than your mortgage rate, the math can favour the longer amortization

Smart Strategy: Take the 30-year amortization to qualify and manage cash flow, but make prepayments when possible. Most mortgages allow 10–20% annual prepayments without penalty. This gets you the flexibility of 30 years with the ability to pay it off faster.

Does 30-Year Amortization Affect CMHC Premium?

No. The CMHC insurance premium is based solely on your loan-to-value ratio (down payment percentage), not your amortization period. Choosing 30 years over 25 years does not change your CMHC premium rate.

30-Year Amortization and the Stress Test

The 30-year amortization directly helps with stress test qualification. Because the stress test uses your monthly payment at the qualifying rate in GDS/TDS calculations, a lower 30-year payment gives you more room under both ratio limits — effectively allowing you to borrow more.

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