Amortization Explained: 25 vs 30 Year Mortgage

Default insurance (the CMHC-style coverage) is required when you put down less than 20%. The premium is added to your mortgage rather than paid up front. It is not available on homes priced at $1,500,000 or more.

For a first-time buyer with a smaller down payment, this change is significant. It means you can now access the lower monthly payment of a 30-year amortization while still buying with less than 20% down. Eligibility rules can shift, so confirm your situation with your lender before you count on it.

Who might choose 30 years?

A 30-year amortization can make sense if a lower monthly payment is what gets you into a home now, or if you expect your income to rise. Many buyers use the breathing room to build an emergency fund or handle post-closing costs. If your budget is tight month to month, the flexibility matters.

Who might choose 25 years?

A 25-year amortization suits buyers who can comfortably carry the higher payment and want to pay less interest overall. You build equity faster and reach mortgage-free sooner. Some lenders also let you make lump-sum prepayments, which lets a 30-year buyer effectively shorten their amortization later.

How does my down payment fit in?

Your down payment and your amortization work together to set your monthly cost. A larger down payment shrinks the loan you amortize, which lowers both your payment and your total interest. In Ontario the minimum is 5% on the first $500,000, 10% on the portion from $500,000 to $1,500,000, and 20% above $1,500,000. On an $800,000 home that is $55,000.

Zown's Down Payment Boost gives eligible Ontario buyers cash back of up to 0.75% of the purchase price, rising to up to 1.25% (max $25,000) when financed through Zown's mortgage partner, Pine. On an $800,000 home through Pine, that is about $10,000. It's paid into your savings at closing with a Zown partner lawyer, or 2 to 8 weeks after closing with your own. Most buyers put it toward closing costs and post-closing expenses like moving and furniture, which frees up their own savings.

See our guides on the minimum down payment in Ontario and how to choose fixed vs variable rates, both of which shape your monthly payment alongside amortization.

See what your Down Payment Boost adds up to →

Amortization is one of the biggest levers on your monthly cost, and the 30-year option now open to first-time buyers gives you real flexibility. Because Zown agents are salaried, the advice you get is not commission-driven, so you can talk through the 25 vs 30 year trade-off honestly. For a full picture of your buying costs, start with our guide for the first-time home buyer in Ontario.

Last updated July 27, 2026. General information, not legal or financial advice.