Choosing your mortgage payment frequency whether monthly, biweekly, weekly, accelerated biweekly or weekly, can significantly impact the total amount you pay, the interest you accrue, and the loan term.
Therefore, it’s essential to compare all available options to find the one that best fits your needs and budget. Let’s dive in!
Which payment frequency to choose for your mortgage?
When it comes to your mortgage, there are five payment frequencies for repaying your loan:
- Monthly
- Biweekly
- Accelerated Biweekly
- Weekly
- Accelerated Weekly
Let's take a closer look at each of these options to help you understand their differences.
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Monthly payment
A monthly payment consists of a single withdrawal from your bank account on the same date each month, totalling 12 payments per year. This option is widely popular for borrowers, as it is typically the default for loan repayment.
This monthly payment amount is influenced by several factors, such as your mortgage balance, down payment, amortization period, and current interest rate.
Example calculation
Let’s say you purchased a house valued at $400,000. With a 5% down payment of $20,000, you’ll need mortgage insurance of $15,200, bringing your total mortgage amount to $395,200.
Assuming you amortize this mortgage over 25 years at an interest rate of 3,42%, your monthly payment would be $1,956.
With monthly payments, by the end of the year, you would have repaid $23,472 of your mortgage.
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Biweekly payment
With a biweekly payment plan, an amount is withdrawn from your account every two weeks, resulting in 26 payments each year. The primary advantage of this option is that it often aligns with the pay period of most individuals.
Example calculation
Using the previous example, to calculate your biweekly payment, take your monthly payment, multiply it by 12 months, and then divide by 26 payment periods.
1,956 × 12 ÷ 26 = $902.77
You would then pay $902.77 every two weeks.
By the end of the year, you would have repaid $23,472 of your mortgage.
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Accelerated biweekly payment
Similar to the biweekly payment, the accelerated biweekly payment is withdrawn every two weeks, totalling 26 payments per year. However, the calculation is different: you simply divide your monthly payment by two.
This result in a slightly higher payment amount compared to the regular biweekly option. While you’ll pay a bit more each year, you’ll also pay off your mortgage faster.
Example calculation
Using the previous example, you would calculate your accelerated biweekly payment by dividing your monthly payment by 2.
1,956 ÷ 2 = $978
You would pay $978 every two weeks.
By the end of the year, you would have repaid $25,428 of your mortgage.
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Weekly payment
As the name implies, a weekly mortgage payment is withdrawn every week, resulting in 52 payments per year.
Example calculation
Using the previous example, to determine your weekly amount, you multiply your monthly payment by 12 months and then divide by 52 weeks.
1,956 × 12 ÷ 52 = $451.38
You would then pay $451.38 each week.
By the end of the year, you would have repaid $23,472 of your mortgage.
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Accelerated weekly payment
The accelerated weekly payment requires you to make a payment each week of the year. Similar to the accelerated biweekly option, this payment method involves a different calculation and results in a higher payment than the regular weekly payment.
Example calculation
Let’s consider your monthly payment is $1,956. To determine the amount of your accelerated weekly payments, you would simply divide the full monthly amount by 2.
1,956 ÷ 4 = $489
You would then pay $489 each week.
By the end of the year, you would have repaid $25,428 of your mortgage.
Comparative table of mortgage payment frequencies
For those who prefer a visual summary, here’s a recap table highlighting the difference between the various payment frequencies mentioned above:
| Frequency | Number of payments per year | Calculation | Example payment amount | |
| Monthly | Once a month | 12 | Monthly payment | $1,956 |
| Biweekly | Every two weeks | 26 | Monthly payment x 12 ÷ 26 | $902,77 |
| Accelerated biweekly | Every two weeks | 26 | Monthly payment ÷ 2 | $978 |
| Weekly | Every week | 52 | Monthly payment x 12 ÷ 52 | $451,38 |
| Accelerated weekly | Every week | 52 | Monthly payment ÷ 4 | $489 |
If you’d like a more accurate estimate tailored to your specific situation, consider using our mortgage calculator to simplify your calculations.
Accelerating your payment frequency: is it a good idea?
As the previous examples illustrate, accelerated weekly and biweekly payment enable you to pay off a larger portion of your mortgage each year. This approach allows you to reduce your loan term and accumulate less interest, all while having a minimal impact on your short-term budget.
However, while there are many benefits to an accelerated payment frequency, it may not be the best choice for everyone. Consider whether you can truly afford to accelerate your repayments:
- Will this decision affect your ability to meet other financial obligations?
- Can you still save for future needs?
- Will you have enough liquidity for regular expenses and other projects?
The key is to select a payment frequency that aligns with your financial capacity.
Need guidance? Consult a mortgage broker. As experts in the field, they can help you determine the most suitable payment frequency based on your unique situation.
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