Canadian Mortgage Calculator

Canadian mortgages compound interest semi-annually (twice a year), not monthly like US mortgages. This changes the effective rate slightly. Mortgage terms in Canada are typically 1–5 years — not 30 — with the full amortization being 25–30 years. You renew at market rates each term, which introduces renewal risk.

The stress test requires you to qualify at the higher of your contract rate plus 2%, or 5.25%. If your rate is 5%, you must prove you can afford payments at 7%. This applies to all insured mortgages and most uninsured mortgages at federally regulated lenders (banks and trust companies).

CMHC insurance is mandatory when your down payment is less than 20%. It protects the lender — not you — if you default. The premium (2.80%–4.00% of the mortgage amount) is added to your mortgage and repaid with interest over your amortization. To avoid it entirely, you need at least 20% down.

With accelerated bi-weekly payments, you pay half your monthly payment every two weeks — 26 payments per year instead of 24. The extra two half-payments equal one full monthly payment, so you're effectively making 13 monthly payments per year. On a $500,000 mortgage this can save 2–3 years and tens of thousands in interest.

The minimum down payment is 5% for homes up to $500,000. For homes between $500,000 and $999,999, it's 5% on the first $500,000 and 10% on the remainder. Homes over $1,000,000 require a 20% minimum down payment. Putting down 20% or more eliminates the CMHC insurance requirement.

If you renew with your same lender, you are generally exempt from the mortgage stress test — OSFI's B-20 guideline does not require re-qualification at renewal. However, if you switch to a new federally regulated lender at renewal, you must qualify at the higher of your new rate plus 2% or 5.25%. This matters because switching lenders can get you a better rate, but the stress test may affect whether you qualify. Credit unions and private lenders have different rules.

It depends on your down payment. For insured mortgages (less than 20% down), repeat buyers purchasing existing homes are capped at 25-year amortization. First-time buyers and buyers of new construction gained access to 30-year insured amortizations in August 2024. However, any buyer who puts 20% or more down (uninsured mortgage) can choose up to 30 years — the 25-year cap applies only to insured mortgages for repeat buyers.

The FHSA is a registered account exclusively for first-time buyers. You can contribute up to $8,000 per year (max $40,000 lifetime) and deduct it from your income — like an RRSP. When you withdraw to buy a qualifying home, the funds come out completely tax-free — like a TFSA. You can also use the Home Buyers' Plan (HBP) to withdraw up to $60,000 from your RRSP tax-free for a first purchase, repaid over 15 years.