If you’re currently looking for a mortgage rate in Canada, read on: Meanwhile, variable mortgage rates remain high after a total of 10 rate hikes carried out by the Bank of Canada between March 2022 and July 2023 that brought the Overnight Lending Rate to 5%. Formerly sky-high bond yields are continuing a descent begun in December, exerting welcome downward pressure on fixed mortgage rates. The mortgage market in Canada has experienced a great deal of volatility in the last couple of months, and the start of 2024 is proving to be no exception. The calculator takes this into account if you change the amortization length (and whether the mortgage is high- or low-ratio) in the input fields. However, lenders will often price rates for these borrowers slightly higher.

Learn more about CMHC insurance.Ī low-ratio borrower, because they pose less risk of default, is not required to take out CMHC insurance, and can amortize their mortgage up to 35 years. As well, high-ratio borrowers are limited to an amortization period of 25 years. Because of this added security, lenders will usually offer lower rates for this group. The lender offsets this by requiring these borrowers to take out mortgage default insurance – also referred to as CMHC insurance – which is backed by government funds in case the borrower stops paying their mortgage. There are different lending rules that will apply to you, depending on the type of borrower you are.Ī high-ratio borrower is considered by a lender to pose higher risk of default, because they have put less cash equity up front into the home purchase, and are more leveraged with mortgage debt. Monthly payment = mortgage principal x (1+ monthly interest rate)^number of payment periods)/(1+monthly interest rate)^number of payment periods -1)Ĥ00,000 x (1+ 0.00459)^300)/(1+0.00489)^300 - 1) = $2,301ĭepending on the size of your down payment, you will either be classified as a low-ratio borrower (meaning you’ve paid more than 20% down), or a high-ratio borrower (less than 20% down). Step 4: Apply the mortgage payment formula: Payment periods = number of years x 12 months Step 3: Calculate the number of total payment periods:

Monthly interest rate = annual interest (%) / 100 / 12 months Take your 4.89% rate and divide by 12 to determine your monthly interest rate = 0.00489. Step 2: Determine your monthly interest rate Purchase price - down payment = mortgage principal Step 1: calculate your mortgage principal amount with the following formula: First, Let’s assume you are buying a home with an asking price of $500,000, and are making a down payment of 20% ($100,000), with a mortgage rate of 4.89%, and amortization of 25 years. While plugging your info into our calculator is a fast and convenient way to determine your mortgage payments, let’s break down the math. Condo fees (if applicable): The approximate dollar amount of any monthly condo fees you may be liable for.Down payment: The dollar amount that you are able to pay up front when purchasing your home.Home price: The dollar amount of your home.In order to effectively use this calculator, here is the information you’ll need to have: If you’re renewing or refinancing and know the total amount of the mortgage, use the “Renewal or Refinance” tab to estimate mortgage payments without accounting for a down payment. If you’re buying a new home, it’s a good idea to use the calculator to determine what you can afford before you start house-hunting. Additionally, you can use the calculator to estimate your total monthly expenses, see what your payments would be if mortgage rates go up and show what your outstanding balance will be over time. Our calculator also shows you what the land transfer tax will be, and approximately how much cash you’ll need for closing costs. You can change the size of your down payment and the payment frequency to see how your regular payment will be affected. It will automatically calculate the cost of mortgage default insurance. The calculator will now show you what your mortgage payments will be.īy default, the mortgage payment calculator will show four different monthly payments, depending on the size of your down payment. The calculator shows the best rates available in your province, but you can also add a different rate. Then, select an amortization period and mortgage rate. To use the calculator, start by entering the purchase price.

Calculating monthly mortgage payment