A mortgage calculator for Canada, because of the differences in the mortgage industry, must be held separate from a mortgage calculator for properties in the United States. The United States housing market, as a result of the poor economy, is shaky at best. Before the crisis, mortgages were lent out to seemingly anyone interested in owning a home. As more and more people purchase homes the demand and subsequent prices for real estate drastically increased.
This increase however, was enshrouded in assumption; the lenders assumed the buyers could pay their inflated mortgages. This assumption led to the housing crisis; a large number of buyers defaulted on their mortgage payments causing foreclosures and allowing the properties to be flipped or resold by the lenders. This unfortunate scenario, because of the country's aversion to debt, never occurred in Canada.
As a result the mortgage structure in Canada is different than the United States’ process. For starters, Canadian tax law is neutral; interest on mortgage payments is not deductible like it is in the United States. This prompts many home buyers to make larger down payments. In turn a larger down payment, shortens the term of the mortgage payment (a 15 year mortgage is the norm in Canada), and necessitates the removal of additional lenders or competing banks.
The Canadian mortgage calculator takes into account the typical mortgage contract offered in Canada. As oppose to the traditional 6 or 7 components offered in an American mortgage calculator, a mortgage calculator for Canada only requires 4 the fulfillment of components.
A Canadian mortgage calculator will first require the sale price of the home in question. The next component is the percentage of the individuals’ down payment–meaning the percentage of the down payment in relation to the sale price of the home. The next component calls for the length of the mortgage and the annual interest rate attached to the loan. Once these variables are filled, an individual using a Canada mortgage calculator will be able to view his or her expected monthly mortgage payment
