1. What is Cash Advance Interest?

Cash advance interest is the cost of borrowing money from your RBC mortgage account. It's calculated monthly based on your outstanding balance and the annual interest rate.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( Balance \) — Outstanding cash advance amount in CAD
• \( Rate \) — Annual interest rate as a percentage
• \( \frac{Rate}{12} \) — Monthly interest rate

Explanation: The formula calculates the monthly interest by converting the annual rate to a monthly rate and applying it to the outstanding balance.

3. Importance of Interest Calculation

Details: Understanding your monthly interest charges helps you manage your mortgage cash advances effectively and plan your repayments to minimize interest costs.

4. Using the Calculator

Tips: Enter your outstanding balance in CAD and the annual interest rate as a percentage. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How often is cash advance interest calculated?
A: RBC typically calculates mortgage cash advance interest monthly, but check your specific mortgage agreement for details.

Q2: Can I reduce my interest charges?
A: Yes, by paying down your balance faster or making additional payments to reduce the principal amount.

Q3: Is this calculator specific to RBC mortgages?
A: While designed with RBC mortgages in mind, the calculation method applies to most mortgage cash advances.

Q4: Are there any fees in addition to interest?
A: Some mortgages may have additional fees for cash advances. Consult your mortgage agreement for complete details.

Q5: How accurate is this calculator?
A: This provides an estimate. Your actual interest may vary based on your specific mortgage terms and calculation methods used by RBC.