Mortgage Amortization Calculator
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Understanding the details of your mortgage is the key to making an informed home-buying decision. An amortization calculator is a powerful tool that can help you do just that.
You can get started with the tool above or continue below to learn more about amortization and mortgages in Canada.
In this article, we will discuss what an amortization calculator is, how it works, and the benefits of using one.
What is an Amortization Calculator?
An amortization calculator is a powerful tool that can help you understand the details of your mortgage. It is a type of financial calculator used to calculate the total cost of your mortgage, including interest and principal payments.
An amortization calculator lets you track your mortgage repayment progress.
How is amortization calculated?
Amortization is calculated by dividing the total amount of the mortgage by the number of payments over the amortization period.
The resulting payment amount includes both principal and interest. The majority of the payment goes toward interest in the early years of the mortgage. As the borrower makes regular payments, the principal and interest decrease. The amortization schedule shows how the payments are allocated over time, allowing the borrower to see the progress of the loan and the total cost of the mortgage.
Good to know
Wondering how much you will pay in interest? Try our amortization calculator for answers.
The Benefits of Using an Amortization Calculator
There are several benefits to using an amortization calculator shopping for a mortgage. An amortization calculator
- Provides an accurate estimate of monthly mortgage payments based on the loan amount, interest rate, and amortization period
- Helps borrowers understand the impact of making additional payments or increasing payment frequency
- Enables borrowers to compare the costs of different mortgage options with varying interest rates, amortization periods and payment frequencies
- Provides a clear picture of how much interest will be paid over the life of the mortgage, which can help borrowers make more informed financial decisions about their home ownership goals.
Using an amortization calculator can help borrowers make more informed financial decisions. Save time and money in the long run when deciding which mortgage option is right for you.
How to Use an Amortization Calculator
To use our amortization calculator, you will three pieces of information:
- Mortgage amount
- The interest rate
- The amortization period
The tool will autofill the monthly payments.
Once you have entered this information, the calculator will generate an amortization schedule that outlines the total cost of your mortgage, the monthly payments required to pay it off, and the interest payments associated with the loan.
How to Use an Amortization Calculator for Refinancing
If you are considering refinancing your mortgage, an amortization calculator can be an invaluable tool. By entering the details of your current mortgage and comparing it to potential new loan options, you can determine whether refinancing is the right decision for you. This can help you save money on interest payments over time and reduce your monthly payments.
Get a mortgage refinance quote today!
Using an amortization calculator can provide borrowers with a clear understanding of their mortgage, including the total cost of the loan, interest payments, and repayment progress. It can also help them compare different mortgage options, make informed financial decisions and save time and money in the long run. By using an amortization calculator, borrowers can have a better understanding of their mortgage, enabling them to make informed decisions about their home ownership goals.
What is amortization on a mortgage?
Amortization on a mortgage refers to the process of paying off a mortgage over a specified period.
Mortgage payments are structured to include both principal and interest payments. As A borrower makes regular mortgage payments, the amount of principal owed decreases, and the amount of interest paid decreases with it.
What is an amortization schedule?
An amortization schedule is a table that outlines the details of a mortgage including the amount of each payment that goes toward the principal and interest, and the remaining balance of the mortgage after each payment.
The amortization schedule shows the progression of the loan over time.
What is an amortization period?
The amortization period is the length of time over which a borrower has to repay a mortgage. This period can vary, but it is typically 25 years for a standard mortgage in Canada.
The amortization period is an essential factor in determining the total cost of the mortgage, as it affects both the monthly payment amount and the amount of interest paid over the life of the loan. The longer the period, the more interest is owed.
What is the maximum amortization period in Canada?
The maximum amortization period for a mortgage in Canada is 25 years for mortgages with less than a 20% down payment.
Borrowers with a down payment of 20% or more may be able to get a 35-year amortization with some lenders.
Good to know
The shorter the amortization period, the lower the total cost of the mortgage, as less interest will be paid over the life of the loan.
Ready to compare the best mortgage rates to plug into the tool? It is easy and free to compare.
Compare mortgage rates now
Good to know
Want to calculate what your mortgage will look like? We have some tools right here on our website that can help:
Our mortgage payment calculator lets you see monthly payments and gives a yearly amortization schedule.
Our mortgage affordability calculator will help you determine how large a mortgage you can get.
Our mortgage default insurance calculator will tell you how much you'll owe for mortgage default insurance
