Canada Mortgage Rates

Your mortgage rate can make a big difference in whether you are able to afford a home or the payment becomes unaffordable. You can see this impact in action using our Mortgage Affordability Calculator by keeping all other variables and changing the mortgage rates to see how the mortgage payment changes.

This makes it important to know about the current mortgage rates in Canada based on the province you are trying to purchase a home in. Find the best up to date mortgage rates with the mortgage rate search tool below.

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Fixed vs variable mortgage rates

When choosing a mortgage in Canada, you will decide between a fixed or variable rate:

  • Fixed rate — Your interest rate stays the same for the entire term, typically 1 to 5 years. This gives you predictable payments and protection against rate increases. Fixed rates are best when rates are expected to rise or you value payment certainty.
  • Variable rate — Your rate moves up or down with your lender’s prime rate, which follows the Bank of Canada’s policy rate. Variable rates are historically lower on average over time, but your payments can increase if rates rise. This option suits borrowers with higher risk tolerance who believe rates will stay flat or decrease.

Use our mortgage calculator to compare monthly payments at different rates and see how each option affects your total cost.

How are mortgage rates determined in Canada?

Canadian mortgage rates are influenced by several key factors:

  • Bank of Canada overnight rate — The central bank sets the overnight lending rate, which directly affects variable mortgage rates. When the Bank of Canada raises or lowers this rate, variable rates follow.
  • Government bond yields — Fixed mortgage rates are closely tied to Government of Canada bond yields, particularly the 5-year bond. When bond yields rise, fixed rates tend to increase.
  • Lender spread — Each lender adds a margin on top of their funding costs to cover risk and profit. This spread varies by institution, which is why rates differ across lenders.
  • Your financial profile — Your credit score, down payment size, and debt ratios all influence the rate a lender will offer you. The mortgage stress test also plays a role in qualification.

How to get the best mortgage rate

Follow these steps to secure the lowest mortgage rate possible:

  • Shop around — Compare rates from at least three to five lenders including banks, credit unions, and online lenders.
  • Use a mortgage broker — Brokers have access to wholesale rates from dozens of lenders and can often find better deals than you would on your own.
  • Improve your credit score — A score above 680 qualifies you for the best rates. Pay down debts and avoid new credit applications before applying.
  • Make a larger down payment — Putting down 20% or more eliminates the need for mortgage insurance and can improve your rate.
  • Consider the total cost — A lower rate with restrictive prepayment terms may cost more than a slightly higher rate with flexibility. Use our mortgage refinance calculator to evaluate the cost of switching later.

Check your mortgage affordability before committing to ensure the payments fit comfortably within your budget.

Current mortgage rate ranges by term

Mortgage rates in Canada vary by term length, type, and lender. This table shows approximate rate ranges for insured (less than 20% down) and uninsured (20%+ down) mortgages from competitive lenders. Rates change frequently — use a mortgage broker or rate comparison tool to get the most current quotes.

Mortgage Term Fixed Rate (Insured) Fixed Rate (Uninsured) Variable Rate
1 year 4.89% – 5.54% 5.04% – 5.79% —
2 year 4.44% – 5.14% 4.59% – 5.29% —
3 year 4.14% – 4.84% 4.29% – 5.04% —
5 year 3.99% – 4.69% 4.14% – 4.84% 4.10% – 4.85%
7 year 4.64% – 5.40% 4.79% – 5.60% —
10 year 5.14% – 5.80% 5.29% – 6.00% —
5-year variable — — 4.10% – 4.85%

Note: Insured mortgages (those with CMHC, Sagen, or Canada Guaranty insurance) typically have slightly lower rates because they carry less risk for lenders. However, they require paying mortgage insurance premiums.

Use our mortgage calculator to see exactly how these rates translate into monthly payments on your specific mortgage amount.

Big bank vs. mortgage broker vs. monoline lender

Not all mortgage lenders are the same. Understanding the differences can save you thousands of dollars.

Big Five banks (TD, RBC, BMO, CIBC, Scotiabank)

  • Posted rates are higher — Big banks advertise posted rates that are typically 0.5% to 1.5% above what you can negotiate
  • Branch access — Convenient for in-person service and bundled products
  • Less competitive rates — The overhead of a branch network means rates tend to be higher than online lenders
  • Prepayment options — Often offer generous prepayment privileges (15–20% annually)
  • Best for: Borrowers who value full-service banking, relationship pricing, and convenience

Mortgage brokers

  • Access to 30+ lenders — Brokers shop your mortgage across multiple banks, credit unions, and monoline lenders to find the best rate
  • No cost to borrowers — Brokers are typically paid by the lender, not the borrower
  • Best rates — Because they have access to wholesale rates and can create competition, brokers often secure the lowest available rates
  • Expert advice — Good brokers can help with complex situations like self-employment, bruised credit, or non-standard properties
  • Best for: Most borrowers, especially first-time buyers and anyone who wants to ensure they are getting the best rate

Monoline lenders (MCAP, First National, RMG, etc.)

  • Competitive rates — Monoline lenders focus exclusively on mortgages and offer rates that are typically lower than big banks
  • No branch network — They operate online or through mortgage brokers, keeping overhead low
  • Standard products — They offer standard mortgage products without the bundled banking services
  • Best for: Rate-sensitive borrowers who do not need full-service banking and are comfortable with a digital-first approach

Bottom line: Using a mortgage broker is the most effective way to access the widest range of lenders and ensure you are getting a competitive rate. The Homewise platform connects you with rates from multiple lenders.

Rate hold explained

A rate hold (or rate guarantee) is a commitment from a lender to lock in a mortgage rate for a set period while you shop for a home or wait for your closing date.

How it works

  • Most lenders offer a 90 to 120-day rate hold on fixed-rate mortgages at no cost
  • The rate is guaranteed even if rates increase during the hold period
  • If rates drop during your hold period, most lenders will give you the lower rate
  • Variable-rate mortgages are typically not eligible for rate holds, as the rate floats with prime

When to get a rate hold

  • Before house hunting — Get a rate hold (along with a pre-approval) so you know exactly what you can afford
  • At mortgage renewal — Lock in a rate up to 120 days before your renewal date using our mortgage renewal calculator to compare options
  • When rates are rising — If the Bank of Canada signals rate increases, a rate hold protects you from higher rates while you finalize your purchase

A rate hold costs nothing and has no obligation. If you find a better rate elsewhere, you can simply switch lenders.

Mortgage rate forecast

Predicting mortgage rates depends on the direction of the Bank of Canada interest rate and Government of Canada bond yields.

Factors affecting the rate outlook

  • Bank of Canada policy — After cutting the overnight rate from 5.00% to 2.75% between June 2024 and March 2025, the Bank has paused to assess economic conditions. Further cuts would benefit variable-rate borrowers, while further holds or increases would favour those with fixed rates.
  • Government of Canada bond yields — The 5-year bond yield, which drives fixed mortgage rates, is influenced by inflation expectations, global economic conditions, and demand for Canadian government debt.
  • Inflation — If inflation remains near the 2% target, rates are likely to stay stable or decline. A resurgence in inflation could push rates higher.
  • Economic growth — Slower growth or recession would likely lead to further rate cuts. Strong growth could lead to rate holds or increases.
  • Global factors — Trade policy, geopolitical events, and U.S. Federal Reserve decisions all influence Canadian rates.

What this means for borrowers

  • If you believe rates will fall further, a variable-rate mortgage may save you money
  • If you believe rates will rise or stay flat, locking in a fixed rate provides certainty
  • For those who are uncertain, a shorter fixed term (2 or 3 years) offers a compromise between rate security and flexibility to renegotiate

Use our mortgage stress test calculator to ensure you can handle potential rate increases regardless of which option you choose.