Canada mortgage calculator with semi-annual compounding
Enter the home price, down payment, rate and amortization, and this Canada mortgage calculator works out the monthly payment the Canadian way.
Last updated Updated for 2026
Estimates only. This is not tax, legal or financial advice. Mortgage default insurance and land transfer tax are not included.
How to use the Canada mortgage calculator
- Enter the home price.
- Enter your down payment as a percentage, for example 20.
- Enter the quoted fixed interest rate and the amortization period in years.
- Press Calculate payment to see the monthly payment, the loan amount and the total interest.
How the Canada mortgage calculator works
Under Canada's Interest Act, fixed-rate mortgage rates are quoted with interest compounded semi-annually rather than monthly. A quoted 4.5% therefore means 2.25% every six months, which is slightly cheaper than 4.5% compounded monthly. The calculator converts the quoted rate into the matching monthly rate before working out the payment.
The amortization period is the total time to pay off the loan, commonly 25 years. The term, often five years, is how long the current rate lasts before you renew. Mortgage default insurance, which is required with less than 20% down, and land transfer tax are not included.
Formula
Monthly rate m = (1 + annual rate ÷ 200)^(1/6) − 1. This gives the same yearly cost as the quoted rate charged twice a year.
Loan = price × (1 − down payment % ÷ 100), and monthly payment = L × m × (1 + m)^n ÷ ((1 + m)^n − 1), with n = years × 12.
Example
A $600,000 home with 20% down needs a $480,000 mortgage. At 4.5% over a 25-year amortization, the monthly rate is about 0.37153% and the payment is about $2,656.67. Total interest over 25 years is about $317,001.
With monthly compounding, as used in the US, the same loan would cost $2,668.00 a month, about $11 more, and roughly $3,400 more in interest over 25 years.
Tips and common mistakes
Under 20% down? Add insurance
Mortgage default insurance from CMHC or a private insurer is added to the loan when the down payment is under 20%, which raises the payment.
Check the stress test
Lenders qualify borrowers at the higher of their contract rate plus 2 points or 5.25%. Enter that rate to see the payment you must qualify for.
Budget for land transfer tax
Most provinces charge land transfer tax when you buy, and Toronto adds a municipal tax of its own.
Start from your take-home pay
Estimate your federal tax and pay after deductions to set a comfortable budget.
Other loans compound monthly
Car loans and personal loans normally compound monthly; use the EMI calculator for those.
Frequently asked questions
Why does Canada use semi-annual compounding?
The Interest Act requires mortgage rates to be stated with yearly or half-yearly compounding, and lenders quote fixed rates compounded twice a year.
Does it work for variable-rate mortgages?
Variable-rate mortgages are usually compounded monthly, so this calculator, set up for fixed rates, will be slightly off for them.
What is the difference between amortization and term?
Amortization is the full payoff period, such as 25 years. The term is the length of your current rate and contract, such as 5 years, after which you renew.
Is CMHC insurance included?
No. If your down payment is under 20%, add the insurance premium to the loan amount yourself.