- Original mortgage amount
- The original amount financed with your mortgage, not to be confused with the remaining balance or principal balance.
- Interest rate
- Annual interest rate. Maximum interest rate is 20%. All Canadian mortgages use semi-annual compounding of interest.
- Amortization period
- Total length of your original mortgage in years. Most common lengths are 20 years and 25 years.
- Accelerated weekly and bi-weekly payments
- 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 loan payoff by going directly against your loan'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.
- Number of years remaining
- This is the total number of years you have left to pay on your mortgage. The earlier you start your payoff plan, the more interest you can save. Just starting a few years earlier can really add up.
- Prepayment type
- This is the type of prepayment you are going to make. You can choose from one time, monthly, weekly, bi-weekly, semi-monthly or yearly.
- Additional payment
- Your proposed extra payment per period, e.g. weekly, bi-weekly, semi-monthly, etc. This payment will be used to reduce your principal balance.
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