--- title: "Canadian mortgage calculator with semi-annual rate | AumnI tools" description: "Calculate Canadian mortgage payments with the semi-annual compounding used for fixed rates, check the minimum down payment and see when default insurance applies." url: https://aumnitools.com/ca/tool/mortgage-calculator category: "Financial" country: "Canada" updated: 2026-11-08 --- # Mortgage Calculator Canadian fixed-rate mortgages are quoted with interest compounded twice a year, so a payment worked out from rate divided by twelve comes out too high. This calculator converts the rate the way the Interest Act describes, then shows the payment, the minimum down payment for your price and a full schedule. ## Canada rules and figures - Fixed-rate mortgages are quoted with interest compounded twice a year and charged monthly. The Interest Act requires the rate to be calculated yearly or half-yearly, not in advance. - On an insured purchase the minimum down payment is 5% of the first $500,000 and 10% of the part above that, for homes priced below $1,500,000. - At $1,500,000 or more mortgage default insurance is not available, so a 20% down payment is needed. - Mortgage default insurance, from CMHC and other insurers, is required by federal rules on high-ratio mortgages where the down payment is under 20%. - With under 20% down, the longest amortization is 30 years for first-time buyers or buyers of a new build, and 25 years otherwise. At 20% or more, the lender sets it. - The $1,500,000 insured price cap and the 30-year option both took effect on 15 December 2024. Land transfer taxes vary by province and are not included. Sources: [Justice Laws: Interest Act, section 6 (mortgages)](https://laws-lois.justice.gc.ca/eng/acts/I-15/section-6.html) (checked 2026-11-08); [FCAC: Information box example, fixed-rate mortgage](https://www.canada.ca/en/financial-consumer-agency/services/industry/bulletins/information-box-examples/credit-agreement-fixed-mortgage.html) (checked 2026-11-08); [FCAC: Mortgage terms and amortization](https://www.canada.ca/en/financial-consumer-agency/services/mortgages/mortgage-terms-amortization.html) (checked 2026-11-08); [CMHC: Purchase mortgage loan insurance](https://www.cmhc-schl.gc.ca/professionals/project-funding-and-mortgage-financing/mortgage-loan-insurance/mortgage-loan-insurance-homeownership-programs/purchase) (checked 2026-11-08); [Department of Finance Canada: Mortgage reforms (Sept 2024)](https://www.canada.ca/en/department-finance/news/2024/09/government-announces-boldest-mortgage-reforms-in-decades-to-unlock-homeownership-for-more-canadians.html) (checked 2026-11-08); [FCAC: How much you need for a down payment](https://www.canada.ca/en/financial-consumer-agency/services/mortgages/down-payment.html) (checked 2026-11-08) ## How the mortgage calculator works The quoted yearly rate is turned into a monthly rate that matches half-yearly compounding: add half the rate to one, take the sixth root, and subtract one. That monthly rate is applied to the remaining balance, and a level payment is set so the loan ends at the last month of the amortization period. Formula: `monthly rate = (1 + yearly rate ÷ 2)^(1/6) − 1, then payment = loan × q × (1 + q)^months ÷ ((1 + q)^months − 1) with q the monthly rate` - The amortization period starts at 25 years. Change it to 30 years to see the longer option available in some cases. - A 4.5% quoted rate becomes a monthly rate of 0.37153%, against 0.375% if it were simply divided by twelve. - The minimum down payment is worked out from the price in tiers, and the page says whether your down payment meets it. - Mortgage default insurance is required with under 20% down, but its premium is not priced here, so the payment shown is lower than you would pay. - Property tax and condo fees are entered as running costs and added to the monthly total; land transfer taxes are not included. ## How to use the mortgage calculator 1. **Enter price and down payment.** Type the price and what you will put down. The page compares it with the minimum for that price. 2. **Choose amortization and rate.** Enter the amortization period in years and the quoted yearly rate. The period starts at 25 years. 3. **Add monthly property costs.** Include property tax, insurance and condo fees to see the whole monthly housing cost. 4. **Test a prepayment.** Enter a monthly extra amount to see the shorter amortization and the interest saved. 5. **Compare renewal rates.** Use the Refinance tab to compare a new rate against your current one over a new term. ## Example: A $600,000 Canadian home with the minimum down payment at 4.5% over 25 years The minimum is 5% of the first $500,000 plus 10% of the next $100,000, which is $35,000, leaving a $565,000 loan before any insurance premium. With semi-annual compounding the payment is $3,127.12 a month and interest is $373,136.66; dividing the rate by twelve would wrongly give $3,140.45. A 30-year amortization lowers the payment to $2,848.82. With 20% down, $120,000, the loan is $480,000 and the payment is $2,656.67. ## When to use the mortgage calculator - **Checking a lender's payment.** Enter the quoted fixed rate to confirm the monthly payment uses half-yearly compounding. - **Finding the smallest down payment.** Enter a price to read the minimum down payment and compare it with the cash you have saved. - **Comparing 25 and 30 years.** See how the longer amortization lowers the payment and how much more interest it adds. - **Planning prepayments.** Add a monthly extra amount to see how many months it removes and the interest saved. ## What the mortgage calculator does not do - Mortgage default insurance premiums are not priced, so with under 20% down the real payment is higher than the one shown. - Semi-annual compounding is applied to every mortgage, which suits fixed-rate loans. A variable-rate mortgage may be quoted differently. - Land transfer taxes, legal fees and the closing costs that vary by province are not part of the payment. - The tool does not model terms and renewals; it assumes one rate for the whole amortization period. - The Affordability tab is a rough guide using an American 28/36 income rule, whereas lenders apply their own stress tests and ratios. ## When something else is a better fit - **When you want to pay down a mortgage you already hold**, use the [Early Payoff Calculator](https://aumnitools.com/tool/early-payoff-calculator.md). - **When you are comparing lender offers side by side**, use the [Loan Comparison Tool](https://aumnitools.com/tool/loan-comparison-tool.md). - **When you need your exact payment and costs**, use the information box your lender must give you before you sign. ## Questions about the mortgage calculator ### Why is my payment lower than rate divided by twelve? Because Canadian fixed-rate mortgages compound twice a year. At 4.5% the monthly rate is 0.37153%, so a $565,000 loan over 25 years costs $3,127.12 a month rather than $3,140.45. ### What is the minimum down payment on $600,000? $35,000 on an insured purchase: 5% of the first $500,000 is $25,000 and 10% of the remaining $100,000 is $10,000. That is 5.8% of the price. ### When is mortgage default insurance required? On high-ratio mortgages, where the down payment is under 20%. At $1,500,000 or more it is not available, so the down payment must be at least 20%. ### Can I choose a 30-year amortization? With under 20% down, yes for first-time buyers and buyers of a new build; others are limited to 25 years. With 20% or more down, the lender decides. A 30-year amortization on the example costs $2,848.82 a month. ### Does the result include insurance premiums or land transfer tax? No. Premiums are not priced and land transfer taxes vary by province, so add them from your lender's quote and your province's calculator. ## Related tools - [Early Payoff Calculator](https://aumnitools.com/tool/early-payoff-calculator.md): Shows how much time and interest an extra monthly payment saves on a loan - [Loan Comparison Tool](https://aumnitools.com/tool/loan-comparison-tool.md): Compares loan offers side by side on monthly payment, total interest and total cost - [Budget Planner](https://aumnitools.com/tool/budget-planner.md): Plans monthly income and expenses by category, with a health score and debt payoff ## About this page Runs in your browser: what you enter is processed on this device and is not uploaded. Estimates for planning only, not financial, tax or legal advice. Check figures that matter with a qualified professional. Last checked against the tool's code on 2026-11-08. Interactive version: https://aumnitools.com/ca/tool/mortgage-calculator