How this calculator works

This assumes the payment stays the same and the amortization shortens, which is how a prepayment usually works. The interest saved is the difference between total interest on the original schedule and total interest after reducing the balance. The implied return on the prepaid amount equals your mortgage rate, which is why prepaying a mortgage is often compared to a risk-free investment at that rate.

Most Canadian mortgages cap prepayments — commonly a percentage of the original principal per year, plus an option to increase the regular payment. Prepaying beyond your privileges can trigger a prepayment charge calculated on the interest-rate differential, which can be substantial on a fixed-rate mortgage. Confirm your privileges before making a large lump-sum payment.

Assumptions and limits

This is an educational estimate produced entirely in your browser. It is not an offer of credit, an approval, or financial advice, and it does not use your real credit file. Lenders apply their own policy, pricing, and verification.