Skip to main content

A great way to save on interest costs and reduce the life of your mortgage is by making annual principal payments.

  • If you choose a closed mortgage, you may prepay up to 10% of the original principal amount of your mortgage once in every 12-month period. The prepayment is applied directly to the principal of your mortgage.
  • You may also Double Up your regular mortgage payments (of principal and interest).
  • You can make a principal prepayment of $500 or more to your open mortgage as often as you like!
  • Plus, you can make principal prepayments of any amount you wish on your mortgage principal at renewal time.
  • A principal prepayment of $2,000 a year can make a substantial difference in the time it takes to pay off your mortgage. Take a look:
  • Example: $80,000 Fixed-Rate Mortgage at 8.00%1

      Monthly payments and 25-year amortization Effect of $8,000 principal payment
    Mortgage repaid (years) 25 16.3
    Total interest cost2 $103,165 $79,873
    Interest savings2 vs. 25-year mortgage N/A $23,292

Related Articles

Increasing your monthly mortgage payments

Learn More

Making Double-Up Mortgage Payments

Learn More

Accelerating your mortgage payment schedule

Learn More