Mortgage Calculator

Your mortgage is likely the biggest loan you’ll take out during your life.

And that’s really what it is – a huge loan you often pay back over the course of a couple decades.

What these 2 factors mean is you’ll be paying a lot of interest before you get this thing paid off. So it’s important to know exactly what you can afford, how much interest you’ll have paid when you finish, and what’s the shortest term you can realistically get.

Here are some important definitions for this complicated beast of a loan:

• The principal: How much you took out (i.e. $200,000)
• The down payment: How much of your own money you paid up front (i.e. $20,000)
• The amortization period: How long in total you’ll take to pay it off (i.e. 20 years)
• The term: How long you have to stick with the current agreement (i.e. 5 years)

You’ll also be faced with the decision between fixed or variable rates. Basically, fixed will start higher than variable, but will stay the same throughout your term. On the other hand, variable will start lower, but will rise and fall with the Canadian prime rate.

Let’s take a look at an example.

If you took out your $200,000 mortgage for 25 years at a fixed interest rate of 6.64%, you’ll have paid $210,388 in interest…that’s more than the price of your original mortgage.

But taking a better interest rate of 3.79% will mean you pay less than half of this interest – at $109,786. And the monthly payments only change by $300 – not a bad price to pay for a more than $100,000 savings.

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