Short answer: on a $700,000 Toronto home with 20% down ($140,000), a 5% fixed rate and a 25-year amortization, the monthly mortgage payment is about $3,257, and you would pay roughly $417,000 in interest over the full amortization if the rate never changed. Use the calculator below to run your own numbers. It follows the Canadian rule of semi-annual compounding for fixed-rate mortgages, checks the minimum down payment and estimates mortgage default insurance when you put down less than 20%.

Mortgage payment calculator

All calculations run in your browser. Nothing you type is sent or stored. Results are estimates for planning only and do not replace a quote from a lender or the advice of a mortgage professional.

How the calculator works

Canadian fixed-rate mortgages are different from American ones in one important way: the interest is compounded semi-annually, not monthly. The posted annual rate is therefore converted into an equivalent rate for each payment period before the payment is calculated.

The formula

• Periodic rate: i = (1 + r / 2)^{2 / n} − 1, where r is the annual rate and n the number of payments per year (12, 26 or 52).
• Payment: PMT = P × i / (1 − (1 + i)^−N), where P is the amount borrowed and N the total number of payments.
• Accelerated bi-weekly: the monthly payment divided by two, paid 26 times a year. Because that adds up to the equivalent of one extra monthly payment per year, the mortgage is paid off sooner.

Worked example

Take a $700,000 condo or townhouse with a $140,000 down payment. The loan is $560,000. At 5% per year, the monthly rate is (1.025)^1/6 − 1, or about 0.4124%. Over 300 monthly payments, the formula gives a payment of about $3,257. Multiply by 300 and subtract the $560,000 borrowed: total interest is roughly $417,000. Switch to accelerated bi-weekly payments in the calculator and you will see the amortization shrink by several years.

Minimum down payment in Canada

Federal rules set the minimum down payment based on the purchase price. The calculator applies these thresholds:

Purchase price	Minimum down payment
$500,000 or less	5% of the price
$500,000 to under $1.5 million	5% of the first $500,000 plus 10% of the portion above $500,000
$1.5 million or more	20% of the price

Rules can change, so confirm the current thresholds with the Financial Consumer Agency of Canada at canada.ca before you make an offer.

Mortgage default insurance

If you put down less than 20%, your mortgage must be insured against default. The premium is a percentage of the loan and is usually added to the mortgage balance. The calculator uses the standard premium tiers published by the main insurers: about 4.00% of the loan with 5% to 9.99% down, 3.10% with 10% to 14.99% down and 2.80% with 15% to 19.99% down. In Ontario, provincial sales tax applies to the premium and must be paid at closing; it cannot be added to the mortgage. Your lender will confirm the exact amount.

Choosing an amortization and frequency

• 25 years is the standard maximum for most insured mortgages. Some buyers, such as eligible first-time buyers or buyers of new builds, may qualify for 30 years on an insured mortgage, and uninsured mortgages with 20% or more down can often go to 30 years.
• Shorter amortization means higher payments but much less interest.
• Accelerated payments are a painless way to cut years off the loan if your budget allows.

Other costs Toronto buyers must budget

The monthly payment is only part of the picture. In the City of Toronto you pay both the Ontario and the municipal land transfer tax, explained with real examples in our Toronto land transfer tax guide. Add legal fees, a home inspection, title insurance, property taxes, condo fees and insurance. Our Toronto cost of living breakdown helps you see how a mortgage fits into a full household budget, and our guide to the best neighbourhoods in Toronto can help you decide where your budget goes furthest.

The stress test

Federally regulated lenders must check that you could afford your payments at a qualifying rate higher than your contract rate. In practice, run the calculator a second time with a rate about two percentage points higher than your offer: if that payment would strain your budget, you may not qualify for the amount you want, or you may want a safety margin.

FAQ

Why is my bank's payment slightly different?

Lenders may round rates, include insurance differently or use the exact closing date. Differences of a few dollars are normal.

Does this work for variable-rate mortgages?

It gives a snapshot at today's rate. Variable rates change over time, and some lenders compound them monthly, so treat the result as an estimate.

Is the total interest what I will really pay?

Only if the rate stayed the same for the whole amortization. Most Canadian mortgages renew every few years at a new rate.

Can I avoid mortgage insurance?

Yes, by putting down at least 20% of the purchase price. Homes priced at $1.5 million or more require 20% down in any case.