An amortization longer than 30 years (35 or 40 years, and very occasionally 50) lowers the required monthly payment further, at the cost of much more interest and much slower equity. In Canada these long amortizations exist only on uninsured mortgages, so they need at least 20% down. This page covers amortizations beyond 30 years; for the 30-year option itself, including the insured 30-year amortization for first-time buyers and new builds, see the 30-year amortization rules and the 25 vs 30-year comparison. More amortization and product guides are in our mortgage types hub.
Amortization is the time it takes to pay the mortgage off; the term is the length of the current rate contract, which renews several times over the amortization. The term vs amortization guide explains the difference.
Why 35 and 40 years need 20% down
The federal rules for insured mortgages cap insured amortizations at 25 years, or 30 years for first-time buyers and new builds. No insured mortgage, from CMHC or a private insurer, can be amortized beyond 30 years. A 35 or 40-year amortization is therefore always an uninsured mortgage, which needs a down payment of at least 20% of the price. The differences between insured and uninsured mortgages, including how each is priced, are covered in insured vs uninsured mortgages.
| Amortization | Insured (under 20% down)? | Down payment needed |
|---|---|---|
| 35 years | No | 20% or more |
| 40 years | No | 20% or more |
| 50 years | No | 20% or more, where offered at all |
Who offers 35 and 40-year amortizations
Each lender sets its own maximum amortization on uninsured mortgages. Many cap it at 30 years, so a 35 or 40-year amortization is usually found through:
- Alternative (B) lenders, which also tend to charge higher rates; see B-lender mortgages.
- Credit unions, which set their own amortization limits.
- Some monoline lenders, usually reached through a mortgage broker.
- Private lenders, at much higher rates and fees.
Availability changes with market conditions, so confirm the maximum amortization with the lender. A mortgage broker can check several lenders at once.
The longer amortization doesn’t get you around the stress test. Lenders check that you could afford the payments at the greater of your contract rate plus 2% or 5.25%, a floor set by OSFI for uninsured mortgages and by the federal government's mortgage insurance rules (the Minister of Finance's Eligible Mortgage Loan Regulations) for insured ones. A longer amortization lowers the payment at that qualifying rate, which is why it can raise the maximum mortgage; the stress test guide has the details.
What a longer amortization costs
$500,000 mortgage at 5%
| Amortization | Monthly payment | Total interest | Extra interest vs 25 years |
|---|---|---|---|
| 25 years | $2,908 | $372,407 | |
| 35 years | $2,507 | $552,983 | $180,576 |
| 40 years | $2,394 | $649,129 | $276,722 |
The figures assume the rate stays at 5% for the whole amortization; in practice it resets at each renewal. The 30-year figures for the same loan are in the 25 vs 30-year comparison. Each extra five years cuts the payment by less than the five before it, while the extra interest keeps growing.
Equity builds more slowly
| After | Paid off, 25 years | Paid off, 35 years | Paid off, 40 years |
|---|---|---|---|
| 1 year | $10,386 | $5,465 | $4,076 |
| 5 years | $57,462 | $30,233 | $22,553 |
| 10 years | $131,019 | $68,934 | $51,422 |
These count principal repaid only, not any change in the home’s value. Slower equity means less room to borrow against the home later, a higher loan-to-value ratio if prices fall, and a smaller cushion if you need to sell.
Prepayments shorten the amortization
Most closed mortgages let you pay extra principal each year without a penalty, up to limits set in the contract; the prepayment privileges guide explains how they work. Extra monthly payments cut a long amortization sharply. On a $500,000 mortgage at 5% with a 35-year amortization:
| Extra each month | Years saved | Interest saved |
|---|---|---|
| $200 | 6.0 | $109,604 |
| $500 | 11.6 | $207,288 |
| $1,000 | 17.0 | $297,455 |
You can also choose a shorter amortization at renewal if your income has grown; the mortgage renewal guide covers what can change at renewal. To model your own figures, use the mortgage amortization calculator.
When a 35 or 40-year amortization fits, and when it doesn’t
| Situation | Why it can work | Caution |
|---|---|---|
| Temporarily lower payments (career change, parental leave) | Keeps the required payment down for a period | Works best with a plan to shorten it later |
| Rental property cash flow | A lower payment improves monthly cash flow | A higher rate from an alternative lender can offset the gain |
| Expected income growth | Eases the early years | Risky if the income growth doesn’t arrive |
| Irregular income | A lower required payment with prepayments in good months | Needs the discipline to prepay |
It tends to work badly when it stretches a purchase beyond what the budget can carry, when there is no plan to prepay or shorten it, when other high-interest debt should be paid first, or when retirement is close.
The “invest the difference” argument
Some borrowers take a long amortization and invest the payment savings. That only comes out ahead if the after-tax return beats the mortgage rate over the period and the savings really are invested every month. With a 35 or 40-year amortization the interest cost is large enough that the assumptions need to hold for a long time.
Related resources
Sources
The figures and rules on this page come from these sources, last checked against them between September 25, 2026 and October 2, 2026. How we check facts.
- Bank of Canada: Mortgage rates, fixed 5 years and over: uninsured residential mortgages, funds advanced (data series)
- Bank of Canada: Conventional 5-year mortgage rate (data series)
- Bank of Canada: Conventional 5-year mortgage rate (data series)
- Bank of Canada: Conventional 5-year mortgage rate (data series)
- Bank of Canada: Data table
- CMHC: CMHC Purchase
- Department of Finance Canada: Boldest mortgage reforms in decades come into force today
- Financial Consumer Agency of Canada: How much you need for a down payment
- Justice Laws (Canada): Interest Act
- Justice Laws (Canada): Eligible Mortgage Loan Regulations
- OSFI: OSFI exempts uninsured mortgage straight switches from the prescribed MQR andβ¦
- OSFI: Amendments to the minimum qualifying rate for uninsured mortgages