Thirty Five Year Amortization

*NOTE* Thirty-Five Year Amortizations are no longer available in Canada. The information below is maintained for historic purposes. Twenty-five year amortization periods or lower are standard as of mid-2012.

New Canadian Mortgage Rules went into effect on March 18th, 2011!

Beginning on March 18th, 2011, Canadians who purchase a home with less than 20% down or refinance above 80% loan-to-value will be limited to a maximum mortgage amortization period of 30 years.

Did you know that you can get a Canadian mortgage that allows you to pay it back over thirty five years? It's true! It has come into effect that, as of October 15th, 2008, the longest amortization period allowed by law for insured mortgages is 35 years.

Apply for a Mortgage Now if you already know you want a Canadian mortgage amortized over thirty five years.

What is an amortization?

Simply stated, the "amortization period" of a mortgage is the length of time it should take you to repay the entire loan, assuming you make nothing but your minimum payments. So a 35-year mortgage amortization would mean that it will take you 35 years to pay off that mortgage. The same is true for 10 years, 15, and 25, etc.

Why would I want to take 35 years to pay off my mortgage?

Well, you probably don't. In fact, most people don't. However, it is sometimes necessary or desirable to obtain a mortgage for 35 years. These are some common reasons to do so:

  1. If you want to purchase a home but you don't qualify to make the higher payments on a mortgage with a shorter amortization period.
  2. You want to keep your minimum payments as low as possible for flexibility - maybe an upcoming career change or maternity leave, for example - and use your pre-payment privileges to pay the mortgage off faster than forty years.
  3. You have purchased a revenue property and want to improve your cash flow and maximize your tax deductions of the interest.
  4. You have other debt obligations that you would prefer to pay off more aggressively, so you want to minimize your short-term mortgage payments

Does it have to take so long?

Absolutely not! In fact, most people who start with a 35 year mortgage amortization period use other techniques to eventually pay it off much faster. The reality is that, with pre-payment privileges, you can pay almost any mortgage off in under five years - as long as you take full advantage of them. Here are some great tips on paying your thirty five year mortgage off much faster:

  • Pay bi-weekly or weekly accelerated payments.
  • Make additional lump sum payments once in awhile - like using your tax refund, for example.
  • Increase your minimum monthly payment when you're able to - instead of spending it or investing it.
  • Sell under-performing unregistered investments and apply the proceeds to the mortgage principal.
  • Choose shorter-term or Adjustable Rate mortgages to lower your typical interest rate. More of your payment will go to reducing principal.

What can I do if I have questions?

We would love to answer any questions you might have about this 35-year mortgages or any other mortgage-related topic. Please Contact Us if you have any specific questions, or you may also refer to our Frequently Asked Questions page for more information. We're here to help!

I want a mortgage with a 35 year amortization - what's next?

Let's get started by having you Contact Us for a face-to-face application or you can fill out our handy, Secure Online Mortgage Application.

Last updated Oct 12, 2018