The real payment, worked out with the semi-annual compounding Canadian law requires. Includes the CMHC premium, the minimum down payment and the stress test qualifying rate.
Monthly payment
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CMHC premium
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Amount borrowed
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Total interest
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Actual payoff
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Payment at qualifying rate
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Semi-annual compounding as required by the Interest Act. Property taxes, closing costs, land transfer tax and insurance are not included. Educational tool: only your lender can confirm an amount.
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What other calculators miss
Semi-annual compounding changes the number
In Canada, the Interest Act requires lenders to compound interest on fixed-rate mortgages no more than twice a year, rather than monthly. American loans compound every month.
The consequence is concrete: at the same nominal rate, a Canadian mortgage payment comes out slightly lower than an American calculator would tell you. The gap looks small over one month, but it runs into thousands of dollars across a full amortization.
This calculator converts the posted rate into an effective periodic rate using the Canadian formula, then derives the payment from that. It's the same method Canadian lenders use in their own tables.
Down payment
The legal minimum by price bracket
On a purchase price of $500,000 or less, the minimum down payment is 5%. Between $500,000 and $1,499,999 the rule becomes a blend: 5% on the first $500,000, then 10% on the portion above. A $700,000 home therefore needs $25,000 plus $20,000, or $45,000.
From $1,500,000 up, mortgage loan insurance is no longer offered and the minimum jumps to 20%. That ceiling was raised from $1M to $1.5M in December 2024, which changed the math considerably in the Toronto and Vancouver markets.
The calculator flags a down payment below the applicable minimum automatically.
Loan insurance
The CMHC premium gets added to your loan
Below 20% down, mortgage loan insurance is mandatory. The premium is calculated on the amount borrowed and varies with the loan-to-value ratio: 4.00% with 5 to 9.99% down, 3.10% from 10 to 14.99%, and 2.80% from 15 to 19.99%.
The part many people discover too late: this premium isn't paid in cash at closing. It's added to the principal and carries interest for the entire amortization. Over 25 years, a $20,000 premium ends up costing considerably more than $20,000.
One regional wrinkle worth knowing: in Quebec, Ontario, Saskatchewan and Manitoba, the sales tax on the premium must be paid in cash at closing and cannot be financed.
Stress test
The rate you actually have to qualify at
Federally regulated lenders don't approve you at your contract rate. They check that you could pay at the qualifying rate, which is the greater of your rate plus two points and the 5.25% benchmark floor.
With a contract rate of 4.5%, you therefore have to show you can carry a payment calculated at 6.5%. That figure appears in the results panel above under "payment at qualifying rate". It's the number that sets your borrowing capacity, not the one you'll actually pay.
The rule covers down payments of 20% and more just as much as insured mortgages. OSFI confirmed in January 2026 that the framework stays unchanged.
FAQ
Common questions
5% up to $500,000. Between $500,000 and $1,499,999, 5% on the first $500,000 then 10% on the remainder. From $1,500,000 up the minimum becomes 20%, since loan insurance is no longer available.
The Interest Act requires semi-annual compounding on Canadian fixed-rate mortgages, while American loans compound monthly. At the same nominal rate the Canadian payment is a bit lower. This calculator applies the Canadian rule.
4.00% of the loan with 5 to 9.99% down, 3.10% from 10 to 14.99%, and 2.80% from 15 to 19.99%. No premium from 20% up. It gets added to the principal and carries interest.
The check that you could pay at a rate above your own: the greater of your rate plus 2 points and the 5.25% floor. It applies even with 20% down at federally regulated lenders.
An accelerated payment is half the monthly payment made 26 times a year, which works out to thirteen monthly payments instead of twelve. The amortization shortens by several years. Switch the frequency in the calculator to see the effect on your own numbers.
25 years for an insured mortgage, extended to 30 years for first-time buyers and new builds. With 20% down or more the mortgage is uninsured and longer terms are possible depending on the lender.
Yes, since 2023 both can be used for the same property. A qualifying FHSA withdrawal is never taxable and never has to be repaid, unlike the HBP. Work out your FHSA room.
The FHSA stacks the RRSP deduction with the TFSA's tax-free withdrawal for a first home. Open yours with code LOIO3A: a $25 bonus plus $10 by Interac e-Transfer after the claim form, for $35 total.
