Mortgage Payment Calculator Canada

Calculate a Canadian mortgage payment using semi-annual compounding, the convention that governs fixed-rate mortgages under the Interest Act. The calculator returns the payment at every frequency your lender offers, the full amortization schedule, the principal and interest split for each period, and the closing costs that sit alongside the down payment.

Compounding

Semi-annual

Canadian fixed-rate convention, not monthly

Frequencies

Six

monthly through accelerated weekly

Accelerated saves

3.2 yrs

on the worked example below, at no change in rate

The formula, spelled out

Canadian fixed-rate mortgages compound twice a year. Converting a quoted annual rate into the periodic rate that actually drives the payment therefore takes a root, not a division. For a monthly payment:

i = (1 + r / 2) ^1/6− 1

At a quoted 4.29%, that gives a monthly periodic rate of 0.354346%. Dividing 4.29 by 12 would give 0.357500% — higher, and wrong for a Canadian fixed mortgage. Every payment on this page uses the semi-annual conversion, so the figures line up with what a lender’s own system will produce rather than with a generic amortization table.

The payment itself is the standard annuity formula, with P the principal, i the periodic rate from above, and n the total number of payments over the full amortization:

PMT = P × i × (1 + i)ⁿ ÷ ((1 + i)ⁿ− 1)

Note that n spans the amortization, not the term. A five-year term on a 25-year amortization is priced over 300 payments; the term simply determines when the rate is re-set.

Worked example: $650,000 with 20% down

A buyer purchases at $650,000 with $130,000 down, leaving a $520,000 uninsured mortgage at 4.29% amortized over 25 years and paid monthly.

Monthly payment

$2,817.67

principal and interest

First payment split

$975 / $1,843

principal / interest

Interest over 25 years

$325,300

at a constant 4.29%

Over a five-year term the borrower pays $169,060 in total, of which $65,060 reduces the principal and $103,999 is interest. The balance at the end of the term is $454,940 — the number that becomes the starting point for a renewal. Roughly 62% of the money paid in the first five years is interest, which is why prepayment privileges are worth far more early in the amortization than late.

What each payment frequency costs

Same $520,000 mortgage, same 4.29%, same 25-year amortization. The only thing that changes is how often you pay.

Frequency	Per payment	Per year	Payoff	Total paid
Monthly	$2,817.67	$33,812	25.0 yrs	$845,300
Semi-monthly	$1,407.59	$33,782	25.0 yrs	$844,552
Bi-weekly	$1,299.22	$33,780	25.0 yrs	$844,495
Accelerated bi-weekly	$1,408.83	$36,630	21.8 yrs	$797,368
Weekly	$649.35	$33,766	25.0 yrs	$844,150
Accelerated weekly	$704.42	$36,630	21.8 yrs	$796,833

The four non-accelerated rows are nearly identical: paying more often saves a few hundred dollars over 25 years, because interest accrues on a slightly lower average balance. The two accelerated rows are a different instrument entirely. They cost $2,818 more a year — exactly one extra monthly payment — and return roughly $47,900 in interest and three years and three months of payments. If you can carry the extra 8.3%, it is usually the highest-return change available on a mortgage you already have.

Amortization length

Amortization	Monthly payment	Total interest	Availability
25 years	$2,817.67	$325,300	Standard on insured and uninsured
30 years	$2,558.74	$401,147	Uninsured generally; insured only for first-time buyers and new builds

Five extra years lowers the payment by $258.93 and adds $75,847 in interest. Stated as a rate of exchange, each dollar of monthly relief costs about $293 over the life of the loan.

Payment calculator FAQs

Why is a Canadian mortgage payment not just the rate divided by 12?▾

Because Canadian fixed-rate mortgages compound semi-annually, not monthly — a convention set in the Interest Act. Dividing the annual rate by twelve overstates the periodic rate. The correct conversion is to take the half-yearly rate and find its sixth root: i = (1 + r/2)^(1/6) − 1. At 4.29% that produces a monthly rate of 0.354346% rather than 0.357500%. The difference looks trivial and is not: over a $520,000 mortgage it changes the payment by several dollars a month and the lifetime interest by thousands.

What does an accelerated payment schedule actually do?▾

It takes your monthly payment, halves it, and charges that half every two weeks. Because there are 26 two-week periods in a year rather than 24, you make the equivalent of thirteen monthly payments instead of twelve. The extra payment goes entirely to principal. On the $520,000 example on this page, accelerated bi-weekly retires the mortgage in 21.8 years instead of 25 and saves roughly $47,900 in interest, without any change to the rate or the term.

Is a plain bi-weekly payment the same as accelerated bi-weekly?▾

No, and the names are close enough to be genuinely misleading. Plain bi-weekly divides your annual cost across 26 payments, so you pay the same amount over the year and finish in exactly the same 25 years. Accelerated bi-weekly divides the monthly payment in half and pays it 26 times, so you pay about 8.3% more each year. Only the accelerated version shortens the amortization. If a lender offers you bi-weekly, ask which one it is.

How much of my first payment goes to principal?▾

Less than you would like, and the ratio is set by the rate rather than by your lender. On a $520,000 mortgage at 4.29% over 25 years, the first payment of $2,817.67 splits into $1,842.60 of interest and $975.07 of principal — about 35 cents of every dollar. That share climbs every month as the balance falls. The calculator plots the full schedule so you can see where the crossover point sits for your own numbers.

Does a 30-year amortization save me money?▾

It lowers the payment and raises the total cost. The same $520,000 at 4.29% costs $2,817.67 a month over 25 years and $2,558.74 over 30 — $259 less per month. But total interest rises from $325,300 to $401,147, so the monthly relief costs about $75,800 over the life of the loan. A longer amortization is a cash-flow tool and a qualification tool. It is not a savings tool.

What are prepayment privileges and how much are they worth?▾

Most closed Canadian mortgages let you put a lump sum against the principal each year — commonly 10% to 20% of the original balance — and increase your regular payment by a similar percentage. Both go straight to principal, so both shorten the amortization. The privileges are contractual and vary meaningfully between lenders, which makes them worth comparing alongside the rate. Exceeding them triggers a prepayment charge calculated the same way as breaking the term.

What closing costs should I budget on top of the down payment?▾

Land transfer tax is usually the largest single item and varies enormously by province and city. Beyond it, budget legal fees and disbursements of roughly $1,000 to $1,500, title insurance of a few hundred dollars, an appraisal of about $300 where the lender requires one, and a home inspection. If your mortgage is insured, the provincial sales tax on the insurance premium is also payable in cash at closing in Ontario, Quebec and Saskatchewan.