Home Back

Mortgage Calculator RBC

RBC Mortgage Formula:

\[ M = P \times \frac{r \times (1 + r)^n}{(1 + r)^n - 1} \]
\[ r = (1 + \frac{i}{2})^{\frac{1}{6}} - 1 \]

CAD
%

Unit Converter ▲

Unit Converter ▼

From: To:

1. What is the RBC Mortgage Calculator?

Definition: This calculator computes monthly mortgage payments according to RBC's specific calculation method for Canadian mortgages.

Purpose: It helps homebuyers estimate their monthly mortgage payments when considering an RBC mortgage product.

2. How Does the Calculator Work?

The calculator uses RBC's mortgage formula:

\[ M = P \times \frac{r \times (1 + r)^n}{(1 + r)^n - 1} \]
\[ r = (1 + \frac{i}{2})^{\frac{1}{6}} - 1 \]

Where:

Explanation: The formula first calculates the effective monthly rate using RBC's semi-annual compounding method, then applies the standard mortgage payment formula.

3. Importance of Mortgage Calculation

Details: Accurate mortgage calculations help borrowers understand their financial commitments and budget appropriately for home ownership.

4. Using the Calculator

Tips: Enter the loan amount in CAD, annual interest rate (without % sign), and select the amortization period. All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: Why does RBC use this specific calculation method?
A: Canadian mortgages typically use semi-annual compounding, which requires this special calculation to determine the effective monthly rate.

Q2: Does this include property taxes and insurance?
A: No, this calculates only the principal and interest portion of your mortgage payment.

Q3: How does changing the amortization period affect payments?
A: Longer amortization reduces monthly payments but increases total interest paid over the life of the loan.

Q4: What's the difference between term and amortization?
A: Amortization is the total repayment period (e.g., 25 years), while term is the length of your current mortgage contract (typically 1-5 years).

Q5: Are RBC mortgage rates negotiable?
A: Yes, mortgage rates are often negotiable based on your financial situation and relationship with the bank.

Mortgage Calculator RBC© - All Rights Reserved 2025