Mortgage Comparison with Prepayments Calculator (Canadian)
Mortgage Comparison with Prepayments Calculator (Canadian) Definitions
- Mortgage amount
- The total dollar amount for this mortgage.
- Interest rate
- The interest rate on this mortgage.
- Mortgage term
- The number of months of this loan. The term is 1 to 84 months.
- Mortgage amortization
- The number of years over which you will repay this mortgage. The most common amortization for mortgages are 20 years and 25 years.
- Payment type
- The payment type determines the frequency of payments. Monthly will have 12 payments per year, weekly 52, bi-weekly 26 and semi-monthly 24
Accelerated weekly and accelerated bi-weekly payment options are calculated by taking a monthly payment schedule and assuming only four weeks in a month. We calculate an accelerated weekly payment, for example, by taking your normal monthly payment and dividing it by four. Since you pay 52 weekly payments, by the end of a year you have paid the equivalent of one extra monthly payment. This additional amount accelerates your mortgage payoff by going directly against your mortgage's principal. The effect can save you thousands in interest and take years off of your mortgage.
The accelerated bi-weekly payment is calculated by dividing your monthly payment by two. You then make 26 bi-weekly payments. Just like the accelerated weekly payments you are in effect paying an additional monthly payment per year.
- Equivalent monthly payment
- The amount that you are effectively paying each month for this mortgage. For loans with monthly payments, this is simply the monthy payments. For all other payment types, this is the sum of your payments for one year divided by 12.
- Mortgage payment
- Periodic principal and interest payment using semi-annual compounding.
- Prepayment type
- The frequency of prepayment. The options are none, weekly, bi-weekly, semi-monthly, monthly, yearly and one-time payment.
- Prepayment amount
- Amount that will be prepaid on your mortgage. This amount will be applied to the mortgage principal balance, based on the prepayment type.
- Start with payment
- This is the payment number when your prepayments will begin. For a one-time payment, this is the payment number when the one-time prepayment will occur.