A regular mortgage payment covers the interest due for a period and reduces principal. The result depends on the Canadian rate convention, payment frequency, amortization, prepayments, fees, and the lender agreement.
Reading-time estimate: 200 words per minute for the article and source names, rounded up. Navigation and related cards are excluded.
Walk through the existing calculator
Enter Mortgage amount 300000, Interest rate 5, Amortization 25 and Term 5. Select Monthly, leave Extra payment and Annual lump sum at 0, and select Get result. The regular payment is $1,744.81, the balance after the five-year term is $265,522.52, and projected full-amortization interest is $223,444.49. Open the annual amortization schedule to see principal, interest and ending balance; Copy or Download retains the assumptions with the result.
The payment formula uses the unrounded monthly rate, approximately 0.004123915465. A zero interest rate instead divides principal by the number of payments. These calculations exclude fees, insurance and tax escrows.
Compare standard and accelerated biweekly payments
Keep every input above and change only Frequency, first to Biweekly and then to Accelerated biweekly. Both have 26 payments per year. The accelerated option increases the payment amount; it is not merely a change of payment dates.
| Frequency | Scheduled payment | Annual scheduled amount | Five-year balance | Projected interest | Approximate payoff |
|---|---|---|---|---|---|
| Biweekly | $805.30 | $20,937.78 | $265,391.08 | $222,301.43 | 25 years |
| Accelerated biweekly | $872.41 | $22,682.59 | $255,504.89 | $187,182.97 | 21 years, 6 months |
What the comparison can and cannot tell you
Accelerating adds about $1,744.81 to the annual scheduled amount and reduces projected interest by $35,118.46 compared with standard biweekly. Annual amounts and schedules use unrounded payments internally; a lender collecting rounded cents can differ. Payoff labels round to the nearest month and the last payment is capped at what remains owed.
The rate stays fixed for the entire hypothetical projection, including after renewal. Check cash-flow timing and contractual prepayment privileges before increasing payments. Try an extra $100 per payment separately, rather than mixing frequency and extra-payment changes and losing track of which choice caused the saving.
The level-payment formula
For a fixed periodic rate and equal payments, the standard amortization formula uses principal P, periodic rate r, and number of payments n.
Payment = P × r × (1 + r)^n ÷ ((1 + r)^n − 1)Canadian fixed-rate mortgage convention
Canadian fixed-rate mortgage examples commonly disclose interest compounded twice per year but charged monthly. To estimate a monthly payment, the nominal semi-annual rate must be converted to an effective monthly rate before using the payment formula.
Monthly rate = (1 + annual nominal rate ÷ 2)^(1/6) − 1Standard and accelerated payment frequencies
FCAC lists monthly, semi-monthly, biweekly, weekly, accelerated biweekly, and accelerated weekly options. Standard frequencies preserve approximately the same annual payment amount. Accelerated biweekly uses half the monthly payment 26 times per year, while accelerated weekly uses one quarter of the monthly payment 52 times per year. Both make the equivalent of one extra monthly payment annually.
| Frequency | Payment definition |
|---|---|
| Monthly | Monthly payment |
| Semi-monthly | Monthly payment ÷ 2 |
| Biweekly | Monthly payment × 12 ÷ 26 |
| Weekly | Monthly payment × 12 ÷ 52 |
| Accelerated biweekly | Monthly payment ÷ 2 |
| Accelerated weekly | Monthly payment ÷ 4 |
Term versus amortization
The term is the period covered by the current mortgage contract. Amortization is the planned time to repay the entire balance. A 25-year amortization can include several shorter terms and future rates that are unknown today.
Extra payments and prepayment privileges
Increasing regular payments or making lump sums may reduce interest and shorten the payoff period. A closed mortgage may limit the amounts or dates allowed without a penalty, so an estimated saving is not permission to make the payment.
- Check the contract's regular-payment increase limit
- Check the annual lump-sum amount and permitted date
- Ask the lender about charges before exceeding a privilege
What an estimate leaves out
- Fees, optional insurance, property taxes, and mortgage default insurance
- Changes at renewal or under a variable rate
- Lender-specific payment dates and rounding
- Prepayment penalties and contract restrictions
- Qualification rules and affordability assessments