How RateReset calculates Canadian mortgages.

Canadian fixed mortgage rates are generally quoted as nominal annual rates compounded semi-annually. If j is the nominal annual rate and m is the number of payments per year, the periodic rate is i = (1 + j / 2)^(2 / m) − 1.

The effective annual rate is (1 + j / 2)^2 − 1. It is not the same as the nominal annual rate. Monthly, semi-monthly, biweekly, and weekly schedules each use their own periodic rate.

For principal P, periodic rate i, and n payments, payment A = P × i × (1 + i)^n / ((1 + i)^n − 1). When i is zero, A = P / n.

After k payments, the closed-form balance is P(1 + i)^k − A((1 + i)^k − 1) / i. Term summaries are also iterated payment by payment so principal and interest can be accumulated and the final partial payment can be handled.

Monthly uses 12 payments per year, semi-monthly 24, biweekly 26, and weekly 52. Accelerated biweekly is one-half of the calculated monthly payment paid 26 times; accelerated weekly is one-quarter paid 52 times.

Monthly equivalents multiply the periodic payment by payments per year and divide by 12. This is a cash-flow comparison, not a change to the contractual payment.

The prepayment model creates separate baseline and strategy schedules. For each scheduled date it accrues interest, applies the regular payment and any recurring increase, then applies eligible one-time or annual lump sums. Monthly dates preserve month-end timing; weekly and biweekly schedules advance by seven and fourteen days.

Current-term results use the entered contract rate only until the derived term-end date. Long-term projections then use the separately entered post-renewal rate. Keeping the payment unchanged and recasting a lower payment are modelled as distinct scenarios. Contract privilege inputs identify a possible overage but do not calculate a lender penalty.

Renewal scenarios hold the entered rate constant for the selected term. They do not forecast rates. Extending amortization can reduce the payment but generally increases interest and the balance remaining later.

The initial affordability model uses disclosed planning limits of 39% gross debt service and 44% total debt service, includes half of condo fees, and qualifies principal at the greater of the configured benchmark or contract rate plus the configured buffer.

These are educational qualification estimates. Lender underwriting, insured-mortgage rules, income treatment, credit, property type, and documentation can change the result.

Calculations retain JavaScript double-precision values internally. Money is rounded only for presentation; lender schedules may round each payment or interest entry differently. Final displayed payments are nearest-cent capable, while summaries default to whole Canadian dollars.

Pure finance functions are isolated from React and tested for zero rates, every frequency, short amortizations, large balances, known examples, dated prepayments, privilege resets, month-end and leap-year schedules, transfer-tax brackets, URL parsing, and currency output.

Methodology last reviewed July 26, 2026. Material financial, legal, tax, and regulatory content requires editorial review before policy-driven updates are published.