Principal vs interest
Principal is the amount you borrowed. Interest is what the lender charges to let you borrow it. Every payment is split between the two, with more going to interest in the early years and more going to principal later.
Mortgage Calculator
Estimate your Edmonton mortgage payment in under a minute.
A proper Canadian mortgage calculator, built for Alberta. Accurate math, current CMHC rules, Alberta registration fees. Designed by Team O'Shea-Thomas for buyers in Edmonton and surrounding areas.
5%
Minimum down payment under $500K
25yr
Standard amortization
$0
Alberta land transfer tax
120 days
Typical rate hold
01 / The Calculator
Run the numbers.
Adjust the inputs below to see your monthly payment, total interest, and what you'll need at closing. Uses current Canadian mortgage rules including semi-annual compounding and CMHC insurance tiers.
This calculator is an educational tool only and does not constitute mortgage advice. REALTORS® are not licensed mortgage advisors. For specific mortgage guidance, consult a licensed mortgage broker.
Mortgage Payment Calculator
Canadian Mortgage Rules · CMHC Insurance · Closing Costs
$
$
%
%
Not sure what rate to use? A mortgage broker can give you today's best rate in about 10 minutes.
Your Payment
$0
per month
Mortgage Summary
Mortgage Amount
$0
CMHC Insurance Premium
$0
Total Mortgage
$0
Total Interest (over amortization)
$0
Total Cost of Mortgage
$0
Estimated Closing Costs
Land Transfer Tax (Alberta)
$0
Land Title Registration
$0
Mortgage Registration
$0
Legal Fees (est.)
$1,500
Home Inspection (est.)
$500
Title Insurance (est.)
$300
Cash Needed at Closing
$0
Disclaimer: This calculator provides estimates only and is not mortgage advice. Alberta has no land transfer tax but charges registration fees based on property value and mortgage amount. Closing cost estimates are typical ranges. Actual costs vary by lender, lawyer, and transaction. CMHC insurance rates reflect current rules. Consult a licensed mortgage broker for current rates and a real estate lawyer for accurate closing cost quotes specific to your purchase.
02 / Important note
If the rate drops prior to closing, you will always benefit from the lower rate.
Bev's note, from 45+ years of selling homes in Edmonton and surrounding areas. If your lender offers rate holds and the market rate drops before your closing date. You get the lower rate, not the originally-locked one.
03 / The Basics
How Canadian mortgages actually work.
A plain-language primer. No jargon, no sales pitch.
Term vs amortization
Your amortization is the total time to pay off the mortgage (typically 25 or 30 years). Your term is the length of your current contract with the lender (typically 5 years). When the term ends, you renew, usually at a new rate.
Canadian compounding
Canadian mortgages compound interest semi-annually, not monthly. This is a legal requirement and it's what our calculator uses. Most American-style calculators get this wrong.
CMHC insurance
If your down payment is under 20%, you pay mortgage default insurance (commonly called CMHC). It's added to your mortgage, not paid upfront. The premium ranges from 2.8% to 4% of your mortgage amount depending on your down payment size.
The stress test
Federal rules require you to qualify at a rate 2% higher than your contract rate (or the OSFI qualifying rate, whichever is higher). This protects against payment shock if rates rise. It doesn't change what you pay, only what you qualify for.
04 / Rate Types
Fixed vs variable. Both are valid.
Fixed rate
- Locked interest rate for the full term (usually 5 years)
- Predictable payment, same amount every month
- Peace of mind if rates rise
- Typically higher rate than variable at the start
- Penalty to break the mortgage early can be significant (interest rate differential calculation)
Variable rate
- Rate moves with the Bank of Canada prime rate
- Payment may stay the same while the split between principal and interest shifts, or payment itself may change, depending on the product
- Usually starts lower than fixed
- Potential to save if rates drop
- Typically three months' interest penalty to break early, less than fixed
The right choice depends on your risk tolerance, your timeline, and what's happening with rates when you lock in. A mortgage broker can walk through both scenarios for your specific situation.
05 / Your Rate
What actually affects the rate you're offered.
Credit score
680+ gets you the best rates. 600 to 680 still qualifies but at higher rates. Under 600 requires alternative lenders.
Down payment size
Under 20% means CMHC-insured rates, which are often LOWER than uninsured rates because the lender's risk is covered. Counter-intuitive but true.
Property type
Primary residences get the best rates. Rental properties, vacation properties, and condos can be priced higher.
Term length
5-year fixed is the most common. Shorter terms (1 to 3 years) typically have different rate profiles. Longer terms (7 to 10 years) usually priced higher.
Lender type
Big banks, monolines (mortgage-specific lenders), credit unions, and alternative lenders all price differently. Monolines and credit unions often beat big banks on rate.
Your income stability
Salaried employees with 2+ years at one job get the best rates. Self-employed, commission-based, and recently-hired borrowers may face higher rates or need more documentation.
06 / Getting Pre-Approved
Talk to a mortgage broker early. It's free.
Mortgage brokers don't charge you anything. They're paid by the lender once your mortgage funds. Their job is to shop your application across multiple lenders and get you the best rate and terms.
Get pre-approved before you start looking seriously. Pre-approval gives you a clear budget so you don't waste time in the wrong price range, an interest rate hold (typically 120 days), and a stronger offer when you find the home.
If you don't have a broker, we can connect you with brokers in Edmonton we trust.
Pre-approval vs pre-qualification: Pre-qualification is a quick estimate based on what you tell the lender. Pre-approval requires documentation (pay stubs, tax returns, credit check) and carries more weight with sellers. Get pre-approved, not just pre-qualified.
07 / FAQ
Questions about mortgages.
A rough starting point: your monthly housing costs (mortgage, property tax, heat, half of any condo fees) should be under 32 to 39% of your gross monthly income (GDS ratio). Total debt payments including housing should be under 40 to 44% (TDS ratio). But these are just guidelines. A mortgage broker can give you a real number in under an hour based on your actual income, debts, and credit.
5% on homes priced at $500,000 or less. On homes between $500,001 and $1,499,999, it's 5% on the first $500,000 plus 10% on the portion above. Homes priced $1.5 million or more require 20% down. If you put less than 20% down, you'll also pay CMHC mortgage default insurance.
Pre-qualification is a quick estimate based on numbers you tell a lender. No documentation required. Pre-approval requires actual documents (pay stubs, tax returns, credit check) and a firm commitment from the lender, typically with a rate hold for 120 days. Sellers take pre-approved buyers much more seriously than pre-qualified buyers.
If you locked in a rate and the market rate drops prior to closing, you will always benefit from the lower rate. The lender honours the lower rate and the adjustment is handled at closing. This is standard in Canada.
Federal rules require lenders to qualify you at a rate that's higher than your actual contract rate. Specifically, the higher of your contract rate + 2% or the OSFI qualifying rate. This doesn't change what you actually pay. It just affects how much the lender will lend you. It's a protection against rising rates.
Yes, but it costs. Fixed-rate mortgages charge the greater of three months' interest or an interest rate differential (IRD) penalty, which can be thousands to tens of thousands of dollars depending on where rates are. Variable-rate mortgages typically charge just three months' interest. Some situations like porting the mortgage to a new property, assumption by a buyer, or refinancing at renewal can avoid the penalty. Talk to your broker before you lock in about how the specific lender handles early payouts.
Ready to talk to a mortgage broker?
We'll introduce you to brokers we trust in Edmonton. No fees, no pressure, just a conversation about your situation.
Call or text Rory or Bev 780-445-8267