A mortgage where the down payment is 20% or more of the purchase price.
Conventional mortgages do not require mortgage default insurance (CMHC, Sagen, or Canada Guaranty) because the higher down payment reduces the lender's risk. Conventional mortgages may offer slightly higher interest rates than insured mortgages (because lenders lose the insurance protection) and can have amortizations up to 30-35 years. Properties over $1.5 million require conventional financing since they are not eligible for mortgage insurance.
Related terms: CMHC Mortgage Insurance | Loan-to-Value (LTV) Ratio | Down Payment