If you’re ready to apply for a mortgage, you might wonder how the amortization period and interest rate you choose has an impact on the total cost of your mortgage. Here’s a breakdown of what your monthly payments might be, in interest and over the life of a $300,000 mortgage.
Monthly payments on a $300,000 mortgage
At a 4.5% fixed interest rate, your monthly mortgage payment on a 25-year mortgage might total approximately $1,667.50 a month, while a 10-year mortgage might cost approximately $3,109.15 a month.
Note that your monthly mortgage payments may differ slightly depending on the type of interest rate (fixed, variable, etc.), your mortgage term, payment frequency, taxes (such as CMHC insurance) and possible other fees.
Your total interest on a $300,000 mortgage
On a 25-year mortgage with a 4.5% fixed interest rate, you’ll pay approximately $200,249.23 in interest over the life of your mortgage. That’s almost half of what you borrowed originally.
If you instead opt for a 10-year mortgage, you’ll pay approximately $73,098.27in interest over the life of your mortgage — much less than half of the interest you’d pay on a 25-year mortgage.
Compare mortgages in Canada
Amortization schedule for a $300,000 mortgage
What is amortization?
Your amortization period is the total number of years you have to pay off your mortgage.
When you take out a mortgage, you agree to pay the principal and interest over the life of the loan. Your interest rate is applied to your balance, and as you pay down your balance, the amount you pay in interest changes.
This means that at the beginning of your loan, a big percentage of your payment is applied to interest. With each subsequent payment, you pay more toward your balance.
Below, you can estimate your monthly mortgage repayments on a $300,000 mortgage at a 3% fixed interest rate with our amortization schedule over 10- and 25- years.
At a 3% fixed-rate over 10-years, you’d pay approximately $2,896.82 monthly. Over the course of a year, that’s a total of $34,761.84 in mortgage payments. In the table below, compare how much you would pay toward both interest and the principal amount each year.
| 1 | $8,643 | $26,119 | $273,881 |
| 2 | $7,848 | $26,913 | $246,967 |
| 3 | $7,030 | $27,732 | $219,235 |
| 4 | $6,186 | $28,576 | $190,660 |
| 5 | $5,317 | $29,445 | $161,215 |
| 6 | $4,422 | $30,340 | $130,875 |
| 7 | $3,499 | $31,263 | $99,611 |
| 8 | $2,548 | $32,214 | $67,397 |
| 9 | $1,568 | $33,194 | $34,204 |
| 10 | $558 | $34,204 | $0 |
At a 3% fixed-rate over 25-years, you’d pay approximately $1,422.63 monthly. Over the course of a year, that’s a total of $17071.56 in mortgage payments. In the table below, compare how much you would pay toward both interest and the principal amount each year.
| 1 | $8,888 | $8,184 | $291,816 |
| 2 | $8,639 | $8,432 | $283,384 |
| 3 | $8,383 | $8,689 | $274,695 |
| 4 | $8,118 | $8,953 | $265,742 |
| 5 | $7,846 | $9,226 | $256,516 |
| 6 | $7,565 | $9,506 | $247,010 |
| 7 | $7,276 | $9,795 | $237,215 |
| 8 | $6,978 | $10,093 | $227,122 |
| 9 | $6,671 | $10,400 | $216,722 |
| 10 | $6,355 | $10,717 | $206,005 |
| 11 | $6,029 | $11,042 | $194,963 |
| 12 | $5,693 | $11,378 | $183,584 |
| 13 | $5,347 | $11,724 | $171,860 |
| 14 | $4,991 | $12,081 | $159,779 |
| 15 | $4,623 | $12,448 | $147,330 |
| 16 | $4,244 | $12,827 | $134,503 |
| 17 | $3,854 | $13,217 | $121,286 |
| 18 | $3,452 | $13,619 | $107,667 |
| 19 | $3,038 | $14,034 | $93,633 |
| 20 | $2,611 | $14,460 | $79,173 |
| 21 | $2,171 | $14,900 | $64,273 |
| 22 | $1,718 | $15,353 | $48,919 |
| 23 | $1,251 | $15,820 | $33,099 |
| 24 | $770 | $16,302 | $16,797 |
| 25 | $274 | $16,797 | $0 |
Other mortgage amounts you might be interested in:
Bottom line
Buying a house is among the biggest investments you’ll ever make. Knowing how much you might pay each month on your $300,000 mortgage — including how much of your payment goes toward your interest and how much goes to your principal amount — can be helpful when deciding on the right amortization period and interest rate.
Learn more about how mortgages work in our comprehensive guide to mortgages.