Case Study · Residential / Prime

A Merged Credit File and a Total Ratio of About 44%: A Major Bank Insured a First Abbotsford Townhouse at About 94%

A married couple with three children were buying their first home, a three-bedroom, two-bathroom townhouse in Abbotsford valued at about $690,000.

Closed in 2024 · Published October 19, 2026

Residential
Prime lender
Insured
Purchase
First-time buyer
Gift

Value: about $690,000
Insured mortgage: about $640,000 plus a premium of about $26,000
Loan-to-value: about 94% of the value
Income used: about $150,000 a year and about $11,000 a year, plus child benefit of about $8,600
Rate in 2024: 5.01%, five-year fixed, 25-year amortization, qualified at 7.01%

The Situation

A married couple with three children were buying their first home, a three-bedroom, two-bathroom townhouse in Abbotsford valued at about $690,000.

The Challenge

One spouse, a general foreman since February 2021, averaged about $150,000 a year over two years; the other earned about $11,000 a year part time, plus child benefit of about $8,600. That spouse's credit file had just been merged with other profiles in the same name, and the total debt-service ratio reached about 44%, the insured limit.

The Solution

In 2024 we placed an insured mortgage of about $640,000 plus a premium of about $26,000 with a major Canadian bank, about 94% of the value, on a five-year fixed term at 5.01% with a 25-year amortization, qualified at 7.01%. Scores of 708 on both files carried a gross ratio of about 38%.

The Outcome

The down payment, about 6% or about $44,000, came from family gifts of $40,000 and $10,000 and about $10,000 of savings, which also covered closing costs of about $10,000.

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An insured first purchase with about 6% down. See the insurance premium on your own price and down payment.

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Step 1 · Your purchase

Insurance program

Borrowed down payment (Flex 95) — borrowing your 5% down payment from a line of credit or loan is allowed with strong credit. It raises the 5%-down premium from 4.00% to 4.50% (the loan payment counts in your debt ratios). Only affects purchases with less than 10% down.

Purchase price

Buying new construction? Enter the price including the 5% GST — insurers calculate the premium on the GST-inclusive price. Insured mortgages cap at $1,499,999 (20% down required at $1.5M+).

Down payment

10% = $90,000

Amortization

Province

PST on the insurance premium is paid at closing in ON (8%), QC (9%) and SK (6%). Other provinces: none.

Insurance premium

$25,110

3.10% of $810,000 loan @ 90.0% LTV

Breakdown

Purchase price$900,000

Down payment$90,000 · 10.0%

Loan before insurance$810,000

Insurance premium (3.10%)$25,110

Total insured mortgage$835,110

Premium can be added to (financed in) the mortgage. PST on the premium, where applicable, is paid in cash at closing.

Premium curve · 8% → 25% down

Watch how the insurance premium drops as you raise your down payment — it hits $0 once you reach 20% (no insurance needed). The curve starts at this home's federal minimum down payment. The marker shows where you are right now.

What this calculator does that most don't

Charges the provincial sales tax on the premium where it applies (ON 8%, QC 9%, SK 6% — Manitoba removed its in 2020) — due in cash at closing, which most calculators quietly omit
Standard insured AND Sagen Insured Stated Income (self-employed) in one tool — switch the program to see the higher stated-income premium
Knows the December 2024 rules: max insured price $1,499,999 (high-ratio, under 20% down — not to be confused with the $999,999 insurable cap) and the first-time-buyer OR new-build gate on 30-year insured amortization, with the 0.20% surcharge applied

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Questions and answers

Questions about this file

Can a just-merged credit file still get an insured mortgage?+

Yes, when the scores hold. In this 2024 file one spouse's credit file had just been merged with other profiles in the same name, and scores of 708 on both files carried the approval at a major Canadian bank.

Can a total debt-service ratio of about 44% pass on an insured mortgage?+

At the limit, yes. In this 2024 file the total debt-service ratio reached about 44%, the insured limit, with a gross ratio of about 38%.

What did the insured mortgage cost?+

A premium of about $26,000. In this 2024 file the insured mortgage of about $640,000 plus the premium was about 94% of the value of the townhouse, about $690,000.

What rate did the mortgage have to qualify at?+

7.01%. In this 2024 file the five-year fixed rate was 5.01%, qualified at 7.01%, with a 25-year amortization.

Can family gifts make up most of the down payment?+

Yes. In this 2024 file the down payment, about 6% or about $44,000, came from family gifts of $40,000 and $10,000 and about $10,000 of savings, which also covered closing costs of about $10,000; incomes of about $150,000 a year as a general foreman since February 2021 and about $11,000 a year part time, plus child benefit of about $8,600, carried it.

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