The Canadian Mortgage Calculator estimates monthly payments for Canadian mortgages, using semi-annual compounding as required by Canadian law and adding CMHC mortgage default insurance when the down payment is under 20%.
Monthly payment: $4,630.61
| Monthly payment (principal & interest) | $3,722.27 |
| Taxes, insurance, HOA and other costs | $908.33 |
| Total monthly payment | $4,630.61 |
| Loan amount | $640,000.00 |
| Down payment | $160,000.00 |
| CMHC mortgage default insurance (added to loan) | $0.00 |
| Effective monthly rate (semi-annual compounding) | 0.4124% |
| Total of 300 mortgage payments | $1,116,681.57 |
| Total interest | $476,681.57 |
The monthly principal and interest payment is P × i ÷ (1 − (1 + i)^−n), where P is the loan amount, i the monthly interest rate and n the number of monthly payments. Early in the loan most of each payment is interest; over time more goes to principal, as the annual schedule shows.
Canadian fixed-rate mortgages compound semi-annually, not monthly, so the effective monthly rate is (1 + rate ÷ 2)^(1/6) − 1, slightly lower than rate ÷ 12. Down payments must be at least 5% on the first $500,000 and 10% on the portion above; with less than 20% down, mortgage default insurance (CMHC or private) of 2.8–4.0% of the loan is added. Worked example (defaults): $800,000 with 20% down at 5% over 25 years gives a $640,000 loan and a payment of about $3,722.
Property tax, home insurance, condo fees, utilities and maintenance add to the monthly cost. Land transfer tax is due on purchase in most provinces.
Canadian mortgages usually have terms of one to five years within a longer amortization, so you renew several times. Lenders apply a stress test at a higher rate to make sure you can afford increases.
Can I pay off early? Usually, but some fixed-rate deals charge early repayment fees.
Is the result exact? It is an estimate; lenders round and may charge extra fees.
What term should I choose? Shorter terms cost more each month but much less interest overall.