Short answer: "biweekly" and "accelerated biweekly" sound similar but aren't. Straight biweekly just splits your monthly payment into smaller, more frequent chunks with no extra cost. Accelerated biweekly quietly adds one full extra payment per year, which is what actually shortens your amortization and saves you interest.
The Options Most Lenders Offer
- Monthly: one payment per month, 12 per year.
- Biweekly: your monthly payment amount, multiplied by 12, divided by 26, paid every two weeks. Same total annual amount as monthly, just spread differently.
- Accelerated biweekly: your monthly payment amount, divided by 2, paid every two weeks, 26 times a year. Because 26 half-payments equal 13 full monthly payments instead of 12, you make one extra full payment every year without noticing it as a lump sum.
- Weekly and accelerated weekly: the same logic, split into 52 or 53 payments a year instead of 26.
Why the "Accelerated" Version Is What Matters
On a $450,000 mortgage at 5% amortized over 25 years, switching from monthly to accelerated biweekly payments can shave roughly two to three years off your amortization and save tens of thousands of dollars in interest over the life of the mortgage, simply because you're paying down principal faster with that one extra payment a year. Straight (non-accelerated) biweekly changes none of that, since the total annual amount paid is identical to monthly.
How to Choose Between Them
If you're paid biweekly yourself, accelerated biweekly often lines up naturally with your paycheques and quietly builds in extra prepayment without you having to think about it. If your cash flow is tight, straight monthly or straight biweekly keeps your payment amount at the true minimum. Either is fine, the key is knowing which one you're actually on, since "biweekly" alone doesn't tell you.
It's a Forced Prepayment, Not Free Money
Accelerated payment options work because they use your own money more efficiently, not because a lender is giving you anything extra. If cash flow is a concern, a separate voluntary lump-sum prepayment on your own schedule can accomplish something similar without locking you into a higher required payment every two weeks.
Not Sure Which One You're On?
Check your mortgage statement or ask your lender directly whether you're on "biweekly" or "accelerated biweekly," it's usually stated explicitly. If you want help modelling the real difference for your mortgage, we'll run the numbers with you.