Canadian Mortgage Calculator
Canadian mortgages are quoted at an annual rate but compounded semi-annually by law, which makes their payments differ slightly from the monthly-compounded loans common elsewhere. This tool converts that semi-annual rate into an equivalent periodic rate, applies it to your financed balance over the chosen amortization, and folds in CMHC default insurance whenever your down payment is below 20%. You can view the payment as monthly, biweekly, or weekly to match how Canadian lenders schedule withdrawals.
Formula
i = (1 + a/2)^(1/6) − 1; Payment = L · i(1 + i)^n / ((1 + i)^n − 1)
- a
- Annual interest rate as a decimal (semi-annually compounded)
- i
- Equivalent effective monthly rate derived from the semi-annual rate
- L
- Loan amount = home price − down payment + any CMHC premium
- n
- Number of monthly periods = amortization years × 12
How it works
- Enter the home price and your down payment in dollars. The calculator subtracts the down payment to get the base loan and works out your down-payment percentage to decide whether CMHC insurance applies.
- If the down payment is under 20%, a CMHC premium (4.0% at 5-9.99% down, 3.1% at 10-14.99%, 2.8% at 15-19.99%) is added to the loan; at 20% or more there is no premium.
- Set the annual interest rate and amortization in years. The rate is compounded semi-annually, converted to an effective monthly rate of (1 + annual/2)^(1/6) - 1, and used to size the payment, which is then divided into monthly, biweekly, or weekly amounts.
Worked example
A C$400,000 home with C$80,000 (20%) down at a 5% annual rate amortized over 25 years, paid monthly.
- Loan amount: 400,000 − 80,000 = C$320,000, and because the down payment is 20% there is no CMHC premium.
- Effective monthly rate: (1 + 0.05 / 2)^(1/6) − 1 ≈ 0.004124.
- With n = 25 × 12 = 300 periods, the monthly payment solves to about C$1,861.14.
Monthly payment ≈ C$1,861.14, with roughly C$238,340.79 of interest paid over the full 25-year amortization.
Frequently asked questions
- Why does this differ from a US mortgage calculator at the same rate?
- Canadian fixed mortgages are compounded semi-annually rather than monthly, so a 5% Canadian rate converts to a slightly lower effective monthly rate than a 5% US loan. That produces a marginally smaller payment for the same balance and term.
- When is CMHC insurance required?
- CMHC mortgage default insurance is required whenever your down payment is less than 20% of the home price. The premium ranges from 2.8% to 4.0% of the loan depending on the down-payment band and is added to the financed balance.
- Does choosing biweekly or weekly payments change my total interest?
- In this calculator the biweekly and weekly figures are simply the monthly payment rescaled across more periods (the annual total is the same), so the displayed total interest is unchanged. Accelerated payment plans that pay more per year would reduce interest, but those are not modelled here.
- Is the rate fixed for the whole amortization?
- This tool assumes a single rate applied across the entire amortization. In practice Canadian mortgages renew every few years at a new rate, so treat the result as an estimate for the current term rather than a guaranteed lifetime cost.