Amortization
The total length of time required to pay off your mortgage in full — typically 25 years in Canada, up to 30 years for first-time buyers and all buyers of new construction on insured mortgages.
Amortization is the total time required to fully repay your mortgage through regular payments. In Canada, 25 years was the standard maximum for insured mortgages for decades, with 30 years being the default for uninsured mortgages. As of December 15, 2024, first-time buyers (any property type) and all buyers of newly built homes can access a 30-year amortization on insured mortgages — an expansion of the narrower August 2024 rules that had limited 30-year amortizations to first-time buyers purchasing new builds only. Your amortization period is distinct from your term — a 5-year term within a 25-year amortization means you commit to current terms for 5 years, then renew the remaining 20 years. Longer amortization lowers your monthly payment but increases total interest paid.
Related Terms
The length of time you're committed to current mortgage conditions — typically 1 to 10 years, with 5 years being the Canadian standard.
A mortgage where CMHC, Sagen, or Canada Guaranty carries the default risk — required when the down payment is less than 20% of the purchase price.
Related Guides
Related FAQs
- How does amortization affect my mortgage?
- How does mortgage insurance affect my ability to extend my amortization?
- What is a 'straight switch' at renewal and how does it relate to amortization?
- How should brokers position 1-2 year terms against 30-year amortizations?
- How much does a 30-year amortization increase borrowing power?