Amortization Period
Période d'amortissement in French
Quick definition
The amortization period is the total length of time it would take to pay off your entire mortgage at your current payment level. In Canada, 25 years is the standard, and it is different from your mortgage term.
Amortization period vs. mortgage term: the #1 confusion
This is the single most common point of confusion for Canadian homebuyers, so let's settle it up front. The amortization period is the full runway to pay off the loan, usually 25 years. The mortgage term is your current contract with your lender, usually 5 years or less. Your interest rate and conditions are locked for the term, not for the amortization period.
Over a 25-year amortization, a typical borrower will go through five or more terms. At the end of each term you renew at whatever rates the market offers, which is why Canadian mortgage payments can jump at renewal even though "nothing changed" about the original loan.
How the amortization period affects your payment
A longer amortization spreads the loan over more payments, so each payment is smaller, but you pay interest for longer and the total cost is higher. A shorter amortization does the opposite: higher payments, less total interest, mortgage-free sooner.
As an example (as of July 2026), a $400,000 mortgage at 5% costs about $2,326 per month over 25 years, but about $2,133 per month over 30 years. The 30-year option saves $193 a month yet adds roughly $70,000 of interest over the life of the loan.
The rules: 25 years vs. 30 years
The maximum amortization depends on your down payment. If you put down less than 20%, your mortgage needs mortgage default insurance and the amortization is normally capped at 25 years. Since December 2024, first-time buyers and buyers of new construction can qualify for insured mortgages with 30-year amortizations (as of July 2026).
With 20% or more down, the mortgage is uninsured and most lenders offer up to 30 years, sometimes 35 at specialty lenders.
In Canada
Canada's system separates the amortization period from the rate guarantee, unlike the United States where a 30-year fixed mortgage locks one rate for the entire 30 years. This is why the concept of a renewal, and the payment shock that can come with it, is a distinctly Canadian experience.
Worked example
Maya buys her first home with 10% down, so her mortgage is insured and amortized over 25 years. Five years later her remaining amortization is 20 years. At renewal she keeps her payment schedule rather than re-extending, which keeps her on track to be mortgage-free at the original date. Re-extending to a fresh 25 years would have lowered her payment but added years of interest.
Related terms
Reviewed by Alexandre Bernier, CFP®, CIM®, PFP®·Updated July 2026