Canada Mortgage Calculator 2026
Last verified · Methodology
Enter your home price, down payment, interest rate, amortization, and term to calculate your Canadian mortgage payment. Includes CMHC insurance (where applicable), stress test qualifying rate, and total cost over term. Uses Canadian semi-annual compounding as required by the Interest Act.
Mortgage Details
Lenders must qualify you at contract rate + 2% or 5.25%, whichever is higher (OSFI B-20).
Uses Canadian semi-annual compounding convention (Interest Act). Includes CMHC premium where applicable. Stress test is for illustration only. Does not include land transfer tax, legal fees, or title insurance. Not financial advice. Verify with a licensed mortgage professional.
How Canadian Mortgages Work
Canadian mortgages are governed by the federal Interest Act, which requires lenders to use semi-annual compounding. This differs from the US, where monthly compounding is standard. For a stated annual rate of 5%, the effective semi-annual rate is 2.5%, and the effective monthly rate is approximately 0.4124%. Your actual monthly payment is slightly lower than a US equivalent at the same stated rate.
The stress test is a federal requirement under OSFI guideline B-20. All lenders regulated by the federal government must qualify you at your contract rate plus 2 percentage points or 5.25%, whichever is higher. If your rate is 4.89%, the lender verifies you can manage payments at 6.89%. This limits borrowing capacity but protects borrowers from overextension if rates rise at renewal.
CMHC (Canada Mortgage and Housing Corporation) mortgage default insurance is mandatory when your down payment is below 20%. The premium is added to your mortgage, not paid out of pocket at closing, and amortised over the loan. For amortization periods over 25 years, a 0.20% surcharge per 5-year block applies.
Most Canadians renew their mortgage every 5 years at prevailing rates. Your amortization might be 25 years, but your term is only 5, after which you negotiate a new rate. The balance remaining after each term is called the renewal balance.
| Home Price | Down (20%) | Mortgage Amount | Monthly Payment |
|---|---|---|---|
| C$400,000 | C$80,000 | C$320,000 | C$1,955 |
| C$500,000 | C$100,000 | C$400,000 | C$2,444 |
| C$600,000 | C$120,000 | C$480,000 | C$2,933 |
| C$700,000 | C$140,000 | C$560,000 | C$3,422 |
| C$900,000 | C$180,000 | C$720,000 | C$4,400 |
Canadian mortgages use semi-annual compounding by law (Interest Act). The formula converts the stated annual rate to a semi-annual effective rate, then derives a payment-period rate. For monthly payments: effective monthly rate = (1 + annual rate/2)^(1/6) - 1. The payment is then M = P x r(1+r)^n / ((1+r)^n - 1), where n is total months.
The federal mortgage stress test (OSFI guideline B-20) requires all federally regulated lenders to qualify you at a rate higher than your contract rate. The qualifying rate is the greater of your contract rate plus 2%, or 5.25%. This means if your actual rate is 5%, you must prove you can afford payments at 7%. The stress test applies to virtually all new mortgages.
CMHC mortgage default insurance is mandatory whenever your down payment is less than 20% of the home's purchase price. The premium ranges from 2.80% to 4.00% of the loan amount depending on your loan-to-value ratio. Homes priced at $1 million or more are not eligible for CMHC insurance, requiring a minimum 20% down payment.
For CMHC-insured (high-ratio) mortgages, the maximum amortization is 25 years. As of 2026, first-time buyers purchasing new builds with an uninsured mortgage can amortize over 30 years. Longer amortization lowers your monthly payment but significantly increases total interest paid.
The 5-year fixed-rate mortgage is by far the most popular in Canada, chosen by roughly 70% of borrowers. It offers rate certainty for 5 years before renewal. Shorter terms (1 to 3 years) give flexibility; longer terms (7 to 10 years) offer more certainty at typically higher rates. Variable-rate mortgages track the Bank of Canada prime rate.
Beyond your mortgage payment, budget for: land transfer tax (0.5% to 5% depending on province and home price), legal or notary fees ($1,500 to $3,000), home inspection ($400 to $600), title insurance ($150 to $400), property tax, and ongoing home maintenance (typically 1% of home value per year). First-time buyers may qualify for federal and provincial rebates on land transfer tax.