How we calculate
Our formulas, assumptions and tests, so you can check our numbers.
Interest rate per payment
Canadian fixed rates compound semi-annually. For p payments a year at annual rate r:
rate per payment = (1 + r/2)2/p − 1
The payment on principal P over n payments is P × i ÷ (1 − (1 + i)^−n).
Payment frequencies
From the monthly payment M: semi-monthly M/2 (24 a year), biweekly 12M/26, weekly 12M/52, accelerated biweekly M/2 (26 a year), accelerated weekly M/4 (52 a year). Each schedule uses the rate per payment for its own frequency.
CMHC premium
Loan-to-value above 80% adds a premium of 2.80%, 3.10% or 4.00% of the loan (+0.20% beyond 25 years), rounded to the cent and added to the principal. Provincial sales tax on the premium is shown as a closing cost.
Affordability
GDS and TDS use the payment at the qualifying rate (max of rate + 2% and 5.25%) on the insured principal. The maximum price is found by binary search on the price with your down payment fixed, applying the minimum down payment rule and premium at each step.
Renewal
The original schedule runs at the contract rate to the end of the term; the remaining balance is then re-amortized at the new rate over the payments the original schedule still had, keeping the payoff date.
Testing
Before every release, the engine runs 50+ automated checks against official examples (Ontario, Toronto and B.C. government worked figures) and independent calculators: for example, $603,135 at 4.49% over 25 years must give $3,334.84 a month, and Ontario land transfer tax on $650,000 must be $9,475.
Limitations
Lenders round differently, may charge prepayment fees, and set their own penalty methods. Variable-rate mortgages are modelled at a constant rate. Results are estimates; confirm with your lender.