Mortgage Calculator Canada

How mortgage payments are calculated in Canada

A Canadian mortgage payment depends on four main inputs: the mortgage principal, the interest rate, the amortization period, and the payment frequency. The payment is calculated so that, at the chosen frequency, the loan is fully repaid by the end of the amortization period. Because interest compounds semi-annually in Canada, the quoted annual rate is first converted to an equivalent periodic rate for the chosen payment frequency.

Canadian mortgage interest calculation

Canadian fixed-rate mortgages commonly use a quoted nominal annual rate compounded semi-annually, not in advance. For a nominal annual rate j and m payments per year, the equivalent periodic rate is:

The level payment is then calculated with the standard amortizing-loan formula:

This is general information about how Canadian mortgage interest is commonly calculated, not individualized financial advice.

Monthly vs biweekly mortgage payments

Monthly payments are made 12 times per year. Regular biweekly payments are the monthly payment multiplied by 12 and divided by 26, paid every two weeks (26 times per year) so the yearly total matches 12 monthly payments. Accelerated biweekly payments are the monthly payment divided by 2, paid 26 times per year — the equivalent of one extra monthly payment annually, which pays the mortgage down faster.

What is accelerated biweekly?

Accelerated biweekly means paying half of the monthly payment every two weeks. Over a year this adds up to 26 half-payments, or 13 full monthly payments instead of 12. The extra payments increase annual principal repayment and can reduce both the amortization period and total interest. This calculator does not guarantee a specific lender result; lender practices may vary.

Weekly vs accelerated weekly

Regular weekly payments are the monthly payment multiplied by 12 and divided by 52, paid 52 times per year so the yearly total matches 12 monthly payments. Accelerated weekly payments are the monthly payment divided by 4, paid 52 times per year — again the equivalent of about one extra monthly payment per year, which can shorten the amortization and reduce interest.

Mortgage term vs amortization

The mortgage term is the length of your current mortgage agreement — the period during which your rate and conditions are fixed, often one to five years. The amortization period is the total time it would take to repay the mortgage in full, often 25 or 30 years. Your term ends before your amortization, at which point you renew or refinance the remaining balance. Term and amortization are not the same and should not be used interchangeably.

Does this calculator include property tax or insurance?

No. This calculator estimates principal-and-interest mortgage payments only. It does not include property taxes, home insurance, condo fees, utilities, or mortgage default insurance premiums unless those premiums are already reflected in the mortgage principal you enter.

Mortgage payment example

For a $500,000 mortgage at a 5% annual interest rate over a 25-year amortization with monthly payments, the estimated regular payment is approximately $2,908.02 per month. This uses the semi-annual compounding convention described above. Actual lender results may vary slightly.

Frequently Asked Questions

How are mortgage payments calculated in Canada?

Canadian mortgage payments are calculated using the mortgage principal, interest rate, amortization period and payment frequency. Because Canadian fixed-rate mortgages typically compound interest semi-annually, not in advance, the periodic interest rate is converted from the quoted annual rate before applying the standard amortizing-loan payment formula.

Why are Canadian mortgage rates compounded semi-annually?

Under the standard Canadian mortgage interest convention, fixed-rate mortgage interest is compounded semi-annually, not in advance. This means a quoted 6% annual rate produces an effective annual rate of about 6.09%. The equivalent periodic rate used for each payment is derived from this semi-annual compounding rather than simply dividing the annual rate by 12.

What is the difference between monthly and biweekly mortgage payments?

Monthly payments are made 12 times per year. Regular biweekly payments are made every two weeks, for 26 payments per year. Because 26 biweekly payments total slightly more than 12 monthly payments, regular biweekly payments reduce the principal a little faster than monthly payments over the same amortization.

What is accelerated biweekly?

Accelerated biweekly is the monthly payment divided by 2, paid every two weeks (26 times per year). This works out to the equivalent of one extra monthly payment per year, which pays the mortgage down faster and reduces total interest compared with regular biweekly payments.

Does accelerated biweekly pay off a mortgage faster?

Yes. Because accelerated biweekly payments are larger than regular biweekly payments (they equal half of the monthly payment rather than the amortized biweekly amount), more goes to principal each year. This typically shortens the amortization period and reduces total interest paid.

What is the difference between mortgage term and amortization?

The mortgage term is the length of your current mortgage agreement, including the rate and conditions — often 1 to 5 years. The amortization period is the total time it would take to pay off the mortgage in full, often 25 or 30 years. Your term ends before your amortization, at which point you renew or refinance the remaining balance.

Can I choose a 30-year amortization in Canada?

A 30-year amortization may be available depending on the lender, the borrower, the property and the type of mortgage. Insured mortgage amortization rules can change and depend on eligibility, so availability is not guaranteed. This calculator is mathematically capable of 30-year amortization, but actual availability depends on your lender and mortgage eligibility.

Does this calculator include property taxes?

No. This calculator estimates principal-and-interest mortgage payments only. It does not include property taxes, home insurance, condo fees, utilities or other homeownership costs.

Does this calculator include mortgage default insurance?

No. This calculator does not automatically add CMHC or other mortgage default insurance premiums. If your default insurance premiums are financed into the mortgage, enter the resulting financed principal if you want those premiums reflected in the payment estimate.

Does this calculator calculate mortgage affordability?

No. This is a mortgage payment calculator, not an affordability or qualification calculator. It does not include income, GDS/TDS ratios, the mortgage stress test, property taxes or debt-service calculations.

Are mortgage calculator results exact?

No. Results are estimates based on the inputs and standard Canadian mortgage conventions. Actual payments, interest accrual and lender practices may vary, especially for variable-rate mortgages and modified or averaged payment schedules.

Do variable-rate mortgages work differently?

They can. Variable-rate mortgages may use different compounding and payment-adjustment conventions than fixed-rate mortgages, and lender practices vary. This calculator estimates payments based on the interest rate you enter using the standard semi-annual compounding convention; it does not reproduce every lender's variable-rate product.

Official Sources

Methodology is based on official Canadian mortgage guidance. Last verified: September 2026.