Question 1

Why does this calculator use semi-annual compounding?

Accepted Answer

Canadian law (Interest Act) requires lenders to compound mortgage interest semi-annually, not monthly. This calculator converts that rate to an effective monthly rate before computing your payment — giving you the same figure a Canadian bank would show.

Question 2

What is CMHC mortgage insurance and when is it required?

Accepted Answer

CMHC insurance is mandatory in Canada when your down payment is less than 20% of the purchase price. The premium (2.8%–4.0% of the loan) is added to your mortgage and repaid over the life of the loan — it is not paid upfront at closing.

Question 3

How does amortization affect my monthly payment?

Accepted Answer

A longer amortization period (e.g., 25 vs. 20 years) lowers your monthly payment but increases the total interest you pay over the life of the loan. Use the calculator to compare scenarios side by side.

Question 4

What is the maximum amortization in Canada?

Accepted Answer

For insured mortgages (down payment under 20%), the maximum amortization is 25 years. For uninsured mortgages (20% or more down), some lenders allow up to 30 years.

Mortgage Payment Calculator

How This Is Calculated

Mortgage Payment Calculator

How This Is Calculated