Canadian Mortgages - HP 10bII+ User Manual

Table 13-15 Calculating the annual interest rate of 9.5%
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Canadian Mortgages

In Canadian mortgages, the compounding and payment periods are not the same. Interest is
compounded semi-annually while payments are made monthly. To use the TVM application
in the HP 10bII+, you need to calculate a Canadian mortgage factor (which is an adjusted
interest rate) to store in I/YR.
For additional information on interest rate conversions, see Interest Rate Conversions in Ch. 6.
Example
What is the monthly payment required to fully amortize a 30-year, 130,000 Canadian
mortgage if the annual interest rate is 12%?
Table 13-16 Calculating the monthly payment for Canadian mortgage
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146 Additional Examples
Display Description
9.50 Stores second interest rate.
-368.38 Calculates payment.
- 1 3,261.64 Calculates total interest and
principal.
Display Description
12.00 Stores known nominal percentage
and number of compounding
periods.
2.00
12.36 Calculates annual effective rate.
12.00 Sets payments per year.
1 1.71 Calculates Canadian mortgage
factor (adjusted interest rate).
130,000 Stores other known values for
mortgage.
360.00
- 1 ,308.30 Calculates monthly payment for
Canadian mortgage.