A Private Mortgage Calculator is designed specifically for estimating payment schedules and interest costs for private loans. Unlike traditional mortgage calculators, this tool is tailored to reflect the distinctive terms, higher interest rates, and flexible options associated with private mortgages in Canada.

Key Inputs Include:

• Loan Amount: How much you need to borrow.
• Interest Rate: Private mortgages generally have higher rates, often between 6% and 15%.
• Loan Term: Usually shorter, ranging from 6 months to 3 years.
• Payment Type: Options for interest-only or principal + interest payments.

How to Use This Private Mortgage Calculator

1. Enter Loan Amount: Input the principal amount you intend to borrow.
2. Set the Interest Rate: Private mortgage rates typically range from 6% to 15%, reflecting the higher risk profile.
3. Select Term Length: Choose the loan term, typically between 6 months and 3 years.
4. Choose Payment Frequency: Options include monthly, bi-weekly, or weekly payments to see the impact on your loan.

For more insights, check the Financial Consumer Agency of Canada (FCAC) on managing mortgage costs effectively.

Example Calculation

Consider a borrower taking a second mortgage with these details:

• Loan Amount: $150,000
• Interest Rate: 10% annually
• Term: 1 year (12 months)
• Payment Type: Interest-only

Results:

• Monthly Payment: $1,250 (interest-only)
• Total Interest Paid: $15,000
• Total Loan Cost: $165,000

At the end of the 1-year term, the borrower will have paid $15,000 in interest and will still owe the original $150,000.

Using a mortgage broker from Citadel Mortgages can help you ensure you have some of the best mortgage rates and products.