New mortgage amount
The proposed mortgage equals the current payout plus requested cash out and any costs selected to be financed. Cash-paid costs reduce net proceeds instead.
Refinance decision analysis
Mortgage Refinancing Calculator Canada
Compare the current mortgage with a proposed refinance, including cash out, maximum LTV, mortgage penalty, fees, payment change, qualifying payment, total interest, and simple break-even.
Cash-out and LTV testCurrent vs new paymentPenalty and closing costsInterest comparison
Calculation inputs
Model the refinance before resetting the mortgage
Compare the current payment and remaining interest with a proposed refinance, including cash out, penalty, transaction costs, LTV, break-even, and the new qualifying payment.
Penalty, fees, LTV, and stress-test assumptions
How the calculation works
Understand the formula before relying on the result
LTV capacity
Maximum refinance amount equals the entered property value times the maximum LTV. The engine compares the requested mortgage with that ceiling and shows remaining cash-out room.
Payment and qualification
Current and new payments use Canadian semi-annual compounding. The proposed mortgage is also tested at the greater of the new rate plus buffer or qualifying-rate floor.
Interest and break-even
The calculator compares current remaining interest with interest over the new full amortization. Simple break-even divides total transaction costs by monthly payment savings and excludes time value of money.
Interpret the result
Payment savings versus interest cost
Extending amortization can reduce the monthly payment while increasing lifetime interest. Both measures should be reviewed together.
Net cash released
When costs are paid in cash, they reduce proceeds. When financed, they increase the mortgage, LTV, payment, and interest.
Break-even
A break-even period is useful only when the refinance actually reduces the payment. It does not capture rate risk, opportunity cost, tax effects, or a future sale.
LTV fit
Fitting the mathematical LTV ceiling does not confirm approval. The lender may use a lower appraisal, lower LTV, or different product structure.
Common mistakes
- Comparing only the old and new rates without including the mortgage penalty.
- Extending amortization without measuring the lifetime-interest effect.
- Treating gross cash out as net proceeds after costs.
- Assuming the property value used by the lender will match an online estimate.
- Ignoring the stress-test payment and full requalification.
What lenders review
- Current payout statement, mortgage type, term, prepayment clause, and penalty.
- Property value, title, secured debts, and requested combined LTV.
- Purpose and use of refinance proceeds.
- Income, debts, credit, and qualifying rate for the new mortgage.
- Legal, appraisal, lender, broker, discharge, and registration requirements.
Planning tips
- Obtain a written payout statement before relying on a penalty estimate.
- Compare a refinance with a HELOC, second mortgage, blend-and-extend, or waiting until maturity.
- Keep the new amortization as short as cash flow reasonably allows.
- Model both financing costs and paying them in cash.
- Use net monthly savings to rebuild reserves or make prepayments rather than automatically increasing spending.
Connected HopeWell knowledge
Connect the mortgage refinancing calculator to the mortgage decision
Use the result alongside HopeWell's guide chapters, glossary definitions, real underwriting case studies, service pages, and related calculators.
Calculation pathway
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Continue into qualification, purchase costs, equity, refinancing, HELOC planning, and mortgage comparison using the connected calculators below.
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Frequently asked questions
Questions about this calculation
How much can I refinance in Canada?
A common planning limit for a conventional refinance is up to 80% of the lender-accepted property value, less existing secured debt and financed costs. Lender and property policy can be more restrictive.
Should I refinance for a lower payment?
A lower payment can help cash flow, but extending amortization may increase total interest. Penalty, fees, rate, term, and the reason for refinancing must be considered.
How is the break-even period calculated?
This calculator divides total refinance costs by estimated monthly payment savings. It is a simple measure and excludes time value of money and future changes.
Can refinance fees be added to the mortgage?
Some eligible costs may be financed if there is sufficient LTV room and the lender permits it. Financing costs increases principal and interest.
Will I need to pass the stress test again?
A refinance is generally a new credit application, so lenders typically requalify the borrower under applicable policy, including the qualifying rate.