Why use a Toronto mortgage calculator?

Mortgages are among the biggest financial commitments you make in your life, and yours is likely to be with you for many years or decades. That's especially true in a city like Toronto, which is second only to Vancouver as the most expensive city to buy a home in Canada. As such, it's a really good idea to know what your mortgage repayments will look like before you sign on the dotted line! A mortgage payment calculator allows you to get a clearer picture of what your amortization schedule and regular payments will look like with different mortgage amounts and rates.

Using a mortgage payment calculator specific to your city is the best way to understand the real cost of a mortgage where you live. This is especially true in Toronto, as there are several unique regulations and taxes associated with purchasing a home in the Greater Toronto Area. This is of course, in addition to the fees that are consistent across Canada.

To better understand the additional costs that are automatically factored into the above Toronto mortgage calculator, we've included details below.

Canadian mortgage regulations

Canada-wide mortgage regulations are set by the Ministry of Finance to help protect homebuyers and lenders. These regulations include guidelines on minimum down payments, maximum amortization period and mortgage default insurance (often known as CMHC insurance). These are included in our Toronto mortgage calculator and their details are listed below as follows:

• The minimum down payment in Canada is 5% of any value under $500,000, plus 10% of the value between $500,000 and $1,000,000. For homes priced above $1,000,000, the minimumm down payment is 20%.
• The maximum amortization is 25 years for down payments under 20% and 35 years for higher down payments.
• Mortgage default insurance must be purchased for down payments between 5% and less than 20%. Visit Ratehub.ca’s CMHC insurance page for more details.

Toronto regulations, taxes and fees

There are specific taxes and fees that you want to be aware of when purchasing in Toronto. these include the municipal and provincial land transfer taxes, PST on mortgage default insurance and Toronto’s mortgage rates. For more details on Ontario’s taxes and regulations, see Ratehub.ca’s Ontario land transfer tax page.

Toronto Vacant Home Tax

On January 1, 2022, the City of Toronto’s Vacant Home Tax (VHT) came into effect. The VHT applies to any residential properties that have been unoccupied for six months or more during a calendar year. The VHT became payable in 2023, and requires all Toronto homeowners to self-declare the occupancy status of their homes (whether they reside there or not). 

The VHT is 1% of the home’s Current Value Assessment, which is provided by the Municipal Property Assessment Corporation (MPAC). For example, if your property is valued at $1,000,000, your VHT bill would come to $10,000: (1% x $1,000,000).

Toronto’s Vacant Home Tax strictly applies to unoccupied properties. If you live in the home as your principal residence, have rented it out for a minimum 30-day lease or have given permission for another individual (such as a relative) to occupy the property, the VHT does not apply to you. 

Other exemptions include the following: 

• Properties where the homeowner has died during the taxable year
• If the homeowner is in the hospital, long-term care or supportive facility for at least six months
• Ongoing repairs and/or renovations are so extensive as to prevent the home from being occupied

You can read the full list of who is impacted by the Vacant Home Tax on the Ratehub Blog.

The Vacant Home Tax can also impact you if you’re buying or selling a home, depending on the closing date of the transaction. If the sale closes between January 1st of the calendar year and the end of the tax declaration period (February 2, 2023), it is the seller’s responsibility to complete the declaration. If the sale closes after the tax declaration deadline, then the responsibility falls on the buyer to confirm the occupancy status of the property the following year. 

If you do not make a Vacant Home Tax declaration by the deadline, or if you make a false declaration, you can be fined between $250 - $10,000. If you are subject to the VHT and fail to pay in a timely manner, you’ll be charged 1.25% of the total amount the following day, and again on the first day of each following month. Ultimately, if you fail to pay the VHT, it is rolled into your property taxes for the year, and a lien can be put on your property.

Toronto mortgage rates

Mortgage brokers and certain lenders can charge different mortgage interest rates depending on the province and city. Ratehub.ca has a comprehensive database of the best mortgage rates in Toronto , which can also be searched through the Toronto payment calculator above.

PST on Ontario CMHC insurance

While CMHC insurance is added to your mortgage balance and paid off over the amortization of your mortgage, PST on CMHC insurance must be paid in cash, up front. Ratehub.ca’s Toronto mortgage calculator automatically calculates this provincial tax and displays it in the drop-down menu “Cash needed: How much extra cash will I need when my house closes”.

Toronto land transfer tax

In addition to Ontario’s Land Transfer Tax, homebuyers in Toronto must pay an additional municipal land transfer tax. This is a marginal tax which costs 0.5% to 2.0% of the home’s value based on its purchasing price. Additional information can be found on Ratehub.ca’s Toronto land transfer tax page.

Toronto land transfer tax rebate

A tax rebate of up to $4,475 is also available to first-time homebuyers in Toronto which will cover the full cost of the LTT for homes $400,000 or less in value.

Visit our Toronto land transfer tax rebate page for more information on conditions and home buyer eligibility.

Ontario land transfer tax (LTT)

Homebuyers in Toronto must also pay Ontario’s land transfer tax, which is a marginal tax that ranges from 0.5% to 2.0% of the home’s purchasing price. More details can be found on Ratehub.ca’s Ontario land transfer tax page.

Ontario land transfer tax rebate

First-time homebuyers in Ontario may be eligible for a tax rebate up to $4,000, which will cover the full LTT for homes $368,333 or less in value.

For more details on eligibility and conditions, visit our Ontario land transfer tax rebate page .