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Mortgage Rate & Term Comparison

A lower rate doesn't always mean a better mortgage.

Compare two mortgage offers side by side to see the difference in payments, interest, principal and what you could still owe at renewal.

Option A

Option B

Results update as you type. Rates are treated as fixed for each term, compounded semi-annually as is standard in Canada.

Your mortgage comparison

Here's what changes

  • 5-Year Mortgage gives you a $269 lower payment per month.
  • 5-Year Mortgage gives you 2 years more before renewal.
  • 3-Year Mortgage would leave you with $9,355 less owing after 3 years.

Neither option is automatically better — the right trade-off depends on what matters most to you.

Both mortgages over the first 3 years — the fairest way to compare them side by side.

RateOption A4.05%Option B3.99%
TermOption A3 yearsOption B5 years
AmortizationOption A25 yearsOption B30 years
Payment$269 differenceOption A$2,644 monthlyOption B$2,375 monthly
Payments in 3 yearsOption A$95,172Option B$85,492
Principal repaid$9,355 differenceOption A$37,054Option B$27,699
Interest paid$326 differenceOption A$58,118Option B$57,792
Balance after 3 years$9,355 differenceOption A$462,946Option B$472,301

Why is this payment lower?

5-Year Mortgage has a lower payment, but part of the difference comes from spreading repayment over 30 years instead of 25 years.

A lower payment doesn't necessarily mean a lower borrowing cost.

Balance remaining

Both mortgages over the first 3 years.

Today · $500,0003-Year Mortgage · $462,9465-Year Mortgage · $472,301

What if I made the same payment?

What if you paid about $2,644/month on 5-Year Mortgage too?

This separates the effect of the interest rate from the effect of the longer amortization. Over the first 3 years:

Principal repaidOption A$37,960Option B$37,054
Interest paidOption A$57,212Option B$58,118
Remaining balanceOption A$462,040Option B$462,946

Paying more than required depends on your mortgage's prepayment privileges.

What are the trade-offs?

3-Year Mortgage

4.05% · 3 years · 25-year amortization

Potential advantages

  • • Shorter commitment before renewal
  • • Shorter amortization pays down principal faster
  • • About $9,355 less owing after 3 years

Things to consider

  • • Higher interest rate
  • • Higher regular payment (about $269/month more)
  • • Must be renewed sooner, at whatever rates are available then

5-Year Mortgage

3.99% · 5 years · 30-year amortization

Potential advantages

  • • Lower interest rate
  • • Lower regular payment (about $269/month less)
  • • Rate and payment certainty for a longer period

Things to consider

  • • Longer commitment before renewal
  • • Longer amortization can mean slower principal repayment
  • • About $9,355 more owing after 3 years

What matters most to you?

We've highlighted the relevant rows above. This is decision support, not a recommendation.

This calculator provides estimates for planning and comparison purposes. Actual mortgage payments, interest costs, lender calculations, penalties, fees and mortgage terms may differ. Review the terms of any mortgage offer carefully with your lender or mortgage professional.

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