When shopping for a mortgage in Canada, one of the lesser-understood but often talked-about decisions you’ll need to make is choosing your payment frequency. Many mortgage clients hear that opting for weekly or bi-weekly payments will help them pay off their mortgage faster. However, that’s not always true—especially if you’re not choosing the accelerated versions of those options.
This blog is here to break down the differences between standard and accelerated payment schedules, explain the real-world implications for your mortgage, and help you decide what makes the most sense based on your financial discipline and cash flow preferences.
What Are the Mortgage Payment Frequency Options?
Most Canadian lenders offer several mortgage payment frequency options:
- Monthly – 12 payments per year.
- Semi-Monthly – 24 payments per year.
- Bi-Weekly (Standard) – 26 payments per year.
- Bi-Weekly Accelerated – 26 payments per year, but higher payment amounts.
- Weekly (Standard) – 52 payments per year.
- Weekly Accelerated – 52 payments per year, but higher payment amounts.
The Key Difference: Standard vs. Accelerated Payments
Standard Payment Schedules:
With standard bi-weekly or weekly payments, your annual mortgage repayment is identical to what you’d pay on a monthly schedule—it’s just divided into more frequent, smaller payments.
Example: If your monthly mortgage payment is $2,000, your standard bi-weekly payment would be $1,000 ($2,000 x 12 months ÷ 26 bi-weekly periods = $1,000).
Result: You’re still paying $24,000 per year—just in smaller chunks. There is no extra payment going toward principal.
Accelerated Payment Schedules:
This is where the magic happens. Accelerated payments are slightly higher than their standard counterparts, resulting in an extra full monthly payment per year going toward the principal.
Example: That same $2,000/month payment would be split into $1,000 bi-weekly accelerated payments, not because of math, but because the lender calculates your payment as if there were 13 months in a year (26 bi- weekly payments x $1,000 = $26,000/year).
Result: You pay $2,000 more per year, directly reducing your mortgage principal faster and shortening your amortization.
Why Standard Bi-Weekly or Weekly Isn’t Better (Unless You Need It for Budgeting)
Many clients mistakenly believe that choosing bi-weekly or weekly payments automatically leads to faster mortgage repayment. But unless you’re on an accelerated schedule, the only benefit is cash flow management.
When Standard Payments Make Sense:
- Budgeting Simplicity: If you’re paid bi-weekly or weekly, aligning your mortgage payments with your income can make personal cash flow smoother.
- Discipline Without Prepayment: For those who struggle with lump-sum prepayments or inconsistent saving habits, more frequent payments can be a gentle way to stay on track.
However, if you are a financially disciplined individual, standard weekly or bi-weekly payments may actually be a missed opportunity.
Make Your Money Work for You
If you’re disciplined with your finances, you might prefer to:
- Stick with Monthly Payments to maximize available cash throughout the month.
- Invest or Save the Difference – Use the freed-up cash flow for high-interest debt repayment, RRSP contributions, or even TFSA investing.
Think of it like paying off your credit card in full every month: You benefit from an interest-free period and still retain liquidity until the due date. Similarly, by not accelerating your mortgage payments, you maintain control over your money, letting it work harder for you elsewhere.
The Psychology of Accelerated Payments
Accelerated payments are a great tool for borrowers who prefer a “set it and forget it” strategy. You commit to paying more, and that automatic increase works silently in the background to reduce your principal and interest over time.
But for others, particularly those who enjoy actively managing their cash flow or investments, it may make more sense to keep mortgage payments predictable and then make lump-sum prepayments strategically.
Which Option Is Right for You?
Choose Accelerated Payments If:
- You want to be mortgage-free faster without actively managing prepayments.
- You’re comfortable with slightly higher payments.
- You prefer an automatic, passive approach to debt reduction.
Choose Standard or Monthly Payments If:
- You are financially disciplined and want flexibility.
- You plan to use extra cash for other investments or debt repayment.
- You prefer active control over your cash flow and prepayment strategy.
Final Thoughts: It’s About Strategy, Not Frequency
The key takeaway is this: Standard bi-weekly or weekly payments do not reduce your mortgage faster—unless they are accelerated. The frequency of payment alone doesn’t generate savings; it’s the total amount paid over the year that matters.
As a mortgage broker, I often advise clients to consider their long-term financial goals, risk tolerance, and discipline level before deciding on a payment schedule. Choosing the right one can align your mortgage with your broader wealth strategy.
Need help deciding what’s best for you? I’m always here to help break it down.