Mortgage Calculator
In the category of real estate loans, the mortgage loan is one of the most interesting options provided, of course, that certain requirements are met. Now, even before evaluating its hypothetical pre-qualification or pre-admission to the mortgage, you are offered the latitude to calculate the projected cost of your mortgage. In this case, you can use an online calculator to determine your potential mortgage payment amount.
How do I calculate my mortgage?
The mortgage loan has elements such as the mortgage payment that can be calculated based on the amortization period, the purchase price of the property, the down payment, the interest rate, etc. This will give you an idea of how much you will have to pay periodically and what various scenarios you can consider to pay less.
It’s important to remember that the online calculator tool cannot replace a professional broker. That’s why we recommend that you contact an Xperto mortgage broker specialist to get as much information as possible.
Use our online calculator to calculate mortgage payments
Our calculator here will help you calculate your mortgage payment amount. Simply enter the different terms of your potential mortgage and our tool will take care of presenting you with the results. Feel free to try several scenarios and compare them.
Understanding mortgages
Are you thinking about acquiring real estate? A real estate property is that built or unbuilt land that you can bring into your estate. It will then become your property. It can be a house, bare land, condominium, etc. A mortgage is a typical loan for the acquisition of built-up land.
What are the requirements for a mortgage?
With a mortgage, you have a mortgage, which requires you to make regular payments to the lender. These are called mortgage payments or mortgage installments. The lender is the mortgagee where you are the mortgagor.
Mortgage payments pay off the interest on the loan and the principal. Principal is the amount you borrow from a lender to buy a home. It includes the purchase price of the home minus the down payment. To this is usually added mortgage insurance if your down payment is less than 20% or if your lender requires it.
The term is the length of time the mortgage contract is in effect. The term varies from a few months to five years or more. At the end of each term, the contract will need to be renewed.
The term is the length of time the mortgage contract is in effect.
Payment frequency can be monthly, bi-monthly, weekly, bi-weekly, accelerated… This is how often you must make your mortgage payments. Like all other terms, it is written into the contract. For a monthly payment frequency, you will be taken on the same date each month.
Accelerated payments are often recommended by brokers in comparison to regular payments. This is because with this payment frequency, you pay back a little more each year without feeling the difference on the repayment amount. This therefore allows you to pay off your mortgage faster and save interest.
The down payment is your personal contribution to the mortgage principal. When your down payment is 20% or more of the purchase price, you are exempt from paying mortgage insurance. However, if your down payment is less than 20%, you must insure the loan with authorized organizations such as Genworth or CMHC. To get the best conditions, it is preferable to opt for a large down payment and to have your loan insured, because lending institutions offer a higher rate for uninsured loans. This will allow you to have a lower capital and to quickly pay the mortgage. In addition, you can increase the amortization period to more than 25 years if your down payment is more than 20% of the purchase price.
How to calculate your interest rate?
The mortgage is granted according to an interest rate. This rate can be fixed, variable or blended. In the first case, the rate remains the same for the duration of your term. In the second case, the rate may decrease or increase during your term. Generally, this rate is lower than a fixed rate. Finally, the last case is a mixture of the first two types of interest rates. One part of your mortgage may have a fixed interest rate and the other a variable interest rate. The two parts may also have different terms.
The posted mortgage rate is often annual. However, in Canada, this rate is capitalized by six months. As a result, the nominal rate, the rate you actually pay, is not the posted rate. This rate is slightly higher than the posted annual rate.
In addition, depending on how often you make mortgage payments, you need to adjust the rate you pay based on the frequency.
Some of the rate is reserved for paying interest on the balance while the other is used to decrease the principal. So, as you move forward with your mortgage, the portion of your payment allocated to interest will decrease to increase the other portion. That’s why a shorter amortization period can save you a lot of money in interest costs. You can also make regular extra payments to lower your principal.
To make this calculation quickly, use our calculator to simulate your mortgage rate.
What is the best mortgage rate right now?
The best rate is subjective and is the one that fits your financial situation.
You can use our online calculator or fill out our interactive form to more easily get an idea of what rate is right for you.
What is amortization period?
Amortization is the length of time it takes to pay off the mortgage in full. Logically, a longer amortization period means smaller payments. But it also means paying more interest. You can influence the amortization period with your down payment.
FAQ
What is the minimum down payment for a mortgage?
The minimum down payment depends on the purchase price of the property, but also on its type. To put it simply, when it comes to single-family, duplex or condominium properties, the minimum down payment is 1/20 of the purchase price of the building. It is 5% of the purchase price if the latter does not exceed $500,000. On the other hand, when the purchase price of the property exceeds $500,000, the minimum down payment is 5% on the first $500,000 and 10% on the second $500,000 to $999,999 combined. If you are planning to buy a $650,000 home, your minimum down payment is $40,000. That’s 5% of $500,000 and 10% of $150,000, or $25,000 + 15,000.
If the purchase price of a property is $1,000,000 or more, the minimum down payment is 20%.
When to take out a mortgage?
Of course, you need to determine what your funding needs and capabilities are based on several factors. After that, you’ll be able to project yourself more easily. Why not apply for a pre-qualification to see if you can qualify for a mortgage based on your expenses and income?
What are the possible terms of a mortgage?
The amortization period of a mortgage loan varies from contract to contract. It must be defined by both parties, taking into account several factors. However, let us specify that the maximum period is 25 years when the down payment is less than 20% of the purchase price of the property and 30 years otherwise.