Second Mortgage Calculator: Payments & Costs (Canada)
Your borrowing room, the fees, your net proceeds and the payment — the complete second mortgage picture at today’s B-lender and private pricing.
Second mortgage calculator
How much room you have, what the fees really take, what lands in your pocket, and the payment — the full picture, not just a payment.
Legal/appraisal figures are typical ranges, not quotes; B-lender seconds often carry lower fees than the defaults shown. For a real worksheet on your property: 1-866-329-8801.
How lenders size a second mortgage: the LTV math
Second-mortgage approvals hang on one number: loan-to-value (LTV) — your first mortgage plus the new second, divided by the home’s appraised value. Most alternative lenders cap LTV around 75–80%.
Worked example: home appraised at $800,000, first mortgage of $520,000. At an 80% cap, total secured lending can reach $640,000 — leaving up to $120,000 of second-mortgage room. Note what’s not in that formula: your credit score. Equity does the qualifying, which is why a second mortgage is often the workable route after a bank decline. The calculator above runs this math for your numbers, at whatever LTV cap you test.
Why second mortgage payments are usually interest-only
Most private second mortgages are structured interest-only with a 1-year term, renewable. On a $60,000 second at an illustrative 10.99%, that’s $60,000 × 0.1099 ÷ 12 = $550 a month. Amortized over 20 years instead, the same loan runs about $619 — so the interest-only structure buys roughly $69/month of breathing room but retires none of the principal.
That structure exists because a second mortgage is a bridge product: it solves this year’s problem (arrears, CRA debt, consolidation) while you rebuild toward refinancing the whole stack at renewal. Judge the payment on a 12–24 month horizon, not the life of your mortgage.
What a second mortgage costs beyond the rate
Pricing a second mortgage on rate alone misses half the picture. Typical costs: lender fee and brokerage fee (together often 2–4% on private seconds), legal fees for both sides, and the appraisal. On a $60,000 second, expect roughly $2,500–$4,500 in combined costs, usually deducted from the advance — so plan the loan size around the net amount you need. Every figure is disclosed before you sign; if a lender won’t put fees in writing up front, walk away.
The blended-rate math: why a second beats breaking a good first mortgage
A second mortgage looks expensive next to your first — until you blend them. Keep a $520,000 first at 4.5% and add a $60,000 second at an illustrative 10.99%, and your overall borrowing cost is:
($520,000 × 4.5% + $60,000 × 10.99%) ÷ $580,000 ≈ 5.2% blended
Compare that against breaking the first mortgage: a refinance at today’s B-lender rates on the full $580,000 plus a prepayment penalty that can run five figures. When your existing first-mortgage rate is low and the penalty is real, the “expensive” second is routinely the cheaper total package. The Refinance vs. Second Mortgage calculator runs both paths side by side.
Frequently Asked Questions
What is a second mortgage and how does it work?
It’s a loan secured against your home behind your existing first mortgage — your current mortgage stays exactly as it is. Because the lender sits second on title, approval is based on your equity rather than your credit score, and funds arrive as a lump sum you can use for anything.
How much can I borrow with a second mortgage?
Most B lenders lend to a combined 80% of your home’s appraised value; private lenders to about 75%. On a $700,000 home with $450,000 owing, that’s roughly $110,000 of room at 80% — the calculator above shows your exact room from your own numbers.
What are second mortgage rates in Canada?
B-lender second mortgages run about 5.99–7.99%. Private seconds run about 9–14%, plus a lender fee of 1–2% and broker fee of 1–2%. Higher than a first mortgage — but on a small balance the dollar cost is modest, and it leaves a low first-mortgage rate untouched.
Can I get a second mortgage with bad credit?
Yes — this is the product built for it. Second mortgage approvals rest on equity and the property, so low scores, consumer proposals, and even mortgage arrears can still qualify. It’s the standard tool for consolidating debt or stopping a power of sale while credit rebuilds.
What is the monthly payment on a second mortgage?
Most private seconds are interest-only: $50,000 at 10% is about $417/month; $80,000 at 12% is about $800/month. Run any amount and rate in the calculator above, including amortized options that pay the balance down.
How fast can I get a second mortgage?
Private seconds can fund in 48–72 hours when the appraisal is available — fast enough to stop a power of sale or cover a closing. B-lender seconds typically take 1–2 weeks.
Second mortgage vs refinancing — which is better?
Refinancing means breaking your first mortgage — penalties, and repricing your whole balance at today’s rates. A second mortgage borrows only the new money and leaves your first alone. Try our refinance vs. second mortgage calculator to price both routes side by side.
Want your real numbers, not estimates?
One call gets you an actual range for your property and situation — before any credit check.
📞 1-866-329-8801
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Parm Mehmi, Principal Broker · FSRA #13163 | FCAA #511322 · Licensed in Ontario, Alberta & Saskatchewan
Planning estimates only — not financial, lending or legal advice. Lender terms vary; appraisals and payout statements govern actual figures.
See What This Looks Like in Your City
These numbers are estimates. What you can actually borrow depends on an appraisal of your property and the lenders active in your market. Pick your city for local figures, or call and we will run it with you.
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Alberta
How much can you get on a second mortgage, and what does it cost?
The formula
Maximum second = home value × 0.80 − first mortgage balance. Net advance = amount borrowed − lender fee − broker fee.
Worked example
On an $800,000 home with a $500,000 first: $800,000 × 0.80 = $640,000, minus $500,000, leaves $140,000 of room. Borrowing $100,000 at 11.99% with a 2% lender fee and 2% broker fee costs $4,000 in fees, so $96,000 is advanced, and interest-only payments are $999.17 a month.
Worth knowing: You repay interest on the full $100,000, not on the $96,000 you receive. That gap is why the effective rate is higher than the quoted rate.
Figures verified August 2026. Estimates only — your actual terms depend on your file.