Tools to calculate your mortgage payments and costs in Canada – MoneySense

Mortgage payment calculator

Understanding the long-term financial implications of a home mortgage, particularly the cumulative impact of interest, can be complicated. A mortgage payment calculator is an essential tool to help you make informed home buying decisions. It helps you estimate your regular mortgage payments based on the home’s purchase price, down payment size, loan interest rate and amortization.

A reliable mortgage payment calculator provides a comprehensive overview of your expected payments, including the total interest you’ll pay over the mortgage term. Additionally, many other housing expenses, such as property taxes, land transfer taxes, and the need for mortgage default insurance, are directly linked to the size of your mortgage and the home’s value. 

The mortgage payment calculator on MoneySense helps you understand your mortgage payments, including the required closing cash and monthly carrying expenses you will need to buy the home you want. 

Mortgage insurance calculator

If you buy a home with less than a 20% down payment in Canada, you must get mortgage default insurance (sometimes, referred to as mortgage insurance). Unlike home insurance, which covers property damage, mortgage default insurance protects the lender if something happens and you can no longer make your mortgage payments. In Canada, this type of insurance is provided by three institutions: CMHC, Sagen and Canada Guaranty.

The mortgage insurance calculator on MoneySense calculates how much you will pay for mortgage default insurance. Your premium is based on the loan-to-value ratio (LTV) of your home.

Based on this ratio, the insurance premium falls between 2.8% and 4% for down payments below 20%. While a down payment higher than this may exempt you from purchasing mortgage insurance, the lender might still require it in certain situations. To use the tool, enter the asking price and down payment amount, and it will provide an estimate of your mortgage insurance premium. 

Land transfer tax calculator

A one-time fee called a land transfer tax (or land transfer fee) must be paid whenever a property changes hands. The charge is levied by the provincial and territorial governments and/or local municipalities. 

Land transfer tax—which must be paid in cash—is in effect across all regions except Alberta, Saskatchewan and the three territories. In these areas, a much smaller land transfer fee is imposed instead. If you’re purchasing in Toronto or Montreal, you’ll pay municipal land transfer tax in addition to provincial land transfer tax.