Mortgage Amortization: 25 vs 30 Years in Canada

Your mortgage amortization period is the total time it takes to pay off your mortgage completely. In Canada, the most common options are 25 and 30 years, though shorter periods like 15 or 20 years are also available.

30-year amortization is only available for mortgages with a down payment of 20% or more (no mortgage insurance required).

You'll pay significantly less interest over the life of the mortgage

Build home equity more quickly with higher principal payments

Can be used with high-ratio mortgages (down payments under 20%)

Higher payment requirements may affect debt service ratios

Higher payments mean less money available for other investments

Lower payments help meet debt service ratio requirements

Extra cash flow can be invested elsewhere potentially

You'll pay significantly more interest over the mortgage life

Build equity more slowly with lower principal payments

The 30-year amortization costs $104,187 more in total interest but saves $221 per month.

You can comfortably afford the higher monthly payments

You're putting down less than 20% (CMHC insurance required)

You have stable, high income with low other debts

You're putting down 20% or more (conventional mortgage)

Lower monthly payments would improve your cash flow significantly

You plan to invest the payment difference at higher returns

You need lower payments to qualify for your desired mortgage amount

Higher home prices make 30-year amortization attractive for affordability, but consider the long-term cost implications.

Lower home prices may make 25-year amortization more feasible with manageable payment increases.

Affordable home prices often favor 25-year amortization for faster equity building and interest savings.

The choice between 25 and 30-year amortization significantly impacts your financial future. Use our calculators to run your specific numbers and speak with a mortgage professional to determine the best option for your situation.

Understand the key differences between 25-year and 30-year amortization periods to make the right choice for your financial situation and long-term goals.