How this calculator works
Canadian law requires fixed-rate mortgages to compound semi-annually rather than monthly, which is why this calculator (and your lender's) gives a slightly different number than most American mortgage calculators. Practically, that means your lender first converts your quoted annual rate into an effective monthly rate using semi-annual compounding, then applies the standard amortization formula to that. The gap versus simple monthly compounding is small in dollar terms per payment, but it adds up meaningfully over a 25 or 30-year amortization, so it's worth getting right rather than approximating.
What is CMHC insurance, and why does it matter?
If your down payment is less than 20% of the purchase price, your mortgage is legally required to carry default insurance — usually from CMHC (Canada Mortgage and Housing Corporation), though Sagen and Canada Guaranty are the two private alternatives. This insurance protects the lender, not you, in case you default, but it's what makes low-down-payment mortgages possible at all in Canada. The premium is calculated as a percentage of your loan amount based on your loan-to-value ratio — the smaller your down payment, the higher the percentage. Rather than being paid in cash, the premium is added directly to your mortgage principal and repaid over the life of the loan, which means you also pay interest on it. The one exception: in Ontario, Quebec, Saskatchewan, and Manitoba, the provincial sales tax on that premium is due in cash at closing, not financed — a detail that catches a lot of first-time buyers off guard when their lawyer sends the final statement of adjustments.
Why investment properties are treated differently
CMHC-style default insurance exists to help owner-occupiers get into the market with less money down — it was never designed to subsidize investment purchases. As a result, investment properties always need at least 20% down and can't be insured this way, regardless of the purchase price. If you're buying to rent it out, budget for that higher down payment requirement from the start rather than discovering it partway through a pre-approval.
Reading the down payment comparison table
The table further down this page holds your price, rate, and amortization constant while showing what changes at 5%, 10%, 15%, and 20% down — useful for seeing exactly how much a bigger down payment saves you in insurance premiums and total interest, not just in a smaller loan. Down payments below the minimum required for a given price are marked as unavailable rather than silently calculated, since Canada's minimum isn't a flat 5% once you're above $500,000 (see the note below your results if that applies to you).
Once you have your payment, head to the closing cost calculator to budget for land transfer tax, legal fees, and everything else due before you get the keys, or check the affordability calculator if you're still narrowing down a price range.