Compare your current mortgage to a new refinanced mortgage and see your monthly savings and break-even point.
Rates as of Q2 2025 (example)
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This calculator compares your current mortgage to a new refinanced mortgage, showing your monthly payment savings, the total interest saved over the life of the loan, and how many months it would take for those savings to cover the cost of refinancing (your "break-even point").
This calculator computes the monthly payment for your current mortgage (based on your current balance, rate, and remaining years) and compares it to the monthly payment for a new mortgage (based on the same balance, but at the new rate and amortization period). The break-even point is how long it takes for your monthly savings to add up to the cost of refinancing.
Formula: Current Payment = Balance amortized at Current Rate over Years Remaining. New Payment = Balance amortized at New Rate over New Amortization Period. Monthly Savings = Current Payment − New Payment. Break-Even (months) = Refinance Fees ÷ Monthly Savings. Lifetime Interest Savings = Total Interest (Current) − Total Interest (New).
Example: A CA$350,000 mortgage balance currently at 6% with 22 years remaining has a payment of roughly CA$2,391/month. Refinancing to a new 5% rate (example rate — enter your actual offered rate) over a fresh 25-year amortization period would give a payment of roughly CA$2,046/month — a monthly saving of about CA$345. With CA$1,000 in refinance fees, the break-even point would be about 3 months, and the lifetime interest savings (comparing total interest over each respective term) would be roughly CA$17,341. (Note: this example is for illustration purposes only and does not represent a loan offer.)
Refinancing a mortgage in Canada typically means breaking your current mortgage contract before its term ends and replacing it with a new one — either with your current lender or a new one — usually to secure a lower interest rate, access home equity, or change your amortization period. If you're refinancing before your current mortgage term ends, most lenders charge a prepayment penalty, often calculated using the Interest Rate Differential (IRD) for fixed-rate mortgages, which can be substantial — this is a critical cost to add to your "refinance fees" input alongside legal and appraisal costs, since it can significantly change your break-even calculation. Refinancing to access home equity (for example, to consolidate debt or fund a renovation) is generally capped at 80% of your home's value under Canadian lending rules — see our Home Equity Loan Calculator and HELOC Calculator for equity-access options. Refinances are also subject to the mortgage stress test, just like new mortgages — see our Mortgage Stress Test Calculator. If your current mortgage term is ending soon anyway, ask your current lender about a "blend-and-extend" option, which can sometimes avoid prepayment penalties by blending your old and new rates over an extended term.
A prepayment penalty (often calculated using the Interest Rate Differential, or IRD, for fixed-rate mortgages) is charged by most lenders if you break your mortgage contract before the term ends. This calculator includes a general "refinance fees" field where you should add your specific prepayment penalty, as it varies significantly by lender, remaining term, and rate environment - contact your current lender for an exact figure before refinancing.
When you refinance, you can choose a new amortization period, which may reset to a longer term (e.g., back to 25 or 30 years) even if you've already paid down your mortgage for several years. While this can lower your monthly payment, it generally increases the total interest paid over the life of the loan compared to keeping a shorter remaining amortization - this calculator lets you compare both effects.
The break-even point is how many months of monthly savings it takes to cover the upfront cost of refinancing (fees and any prepayment penalty). If you plan to keep the mortgage (or stay in the home) longer than the break-even point, refinancing is likely to save you money overall. If you might sell or move before then, the upfront costs may outweigh the savings.
Yes. Refinances with federally regulated lenders are subject to the same mortgage stress test as new mortgages - you must qualify at a rate higher than your contract rate. This could limit how much you can refinance or access in equity, even if your existing mortgage payments are affordable. See our Mortgage Stress Test Calculator.
Yes, refinancing is one way to access home equity, generally up to 80% of your home's appraised value (minus your existing mortgage balance). This calculator focuses on comparing payments and interest between your current and new mortgage on the same balance - if you're increasing your balance to access equity, see our Home Equity Loan Calculator or HELOC Calculator, which are designed for that purpose.
Not exactly. A blend-and-extend keeps your mortgage with your current lender, blending your existing rate with a new rate over an extended term, often without the prepayment penalty that a full refinance (especially with a new lender) might trigger. It's worth asking your current lender about this option before pursuing a full refinance, particularly if your main goal is a lower rate rather than accessing equity or changing lenders.
Disclaimer: The information, rates, and figures provided on this page are for educational and illustrative purposes only and do not constitute a mortgage offer or financial advice. The default interest rates are sample values and do not reflect rates currently available from any specific lender. This calculator does not automatically include prepayment penalties (such as the Interest Rate Differential), which can be substantial and must be added manually to the refinance fees field. Mortgage stress test requirements, equity-access limits, and lender-specific rules vary and are not fully reflected here. Always obtain a personalised quote from a lender or mortgage broker, including your exact prepayment penalty, before making refinancing decisions.