Your credit score doesn’t just determine whether you get a mortgage — it directly determines how much you pay. Here’s the precise relationship between your score and your rate in Canada.
For reference, the posted (benchmark/stress-test) 5-year fixed mortgage rate is 6.09% as of August 26, 2026 (Bank of Canada Valet API, series V80691335); actual discounted rates — including the score-based tiers below — run well below that figure.
The rate ladder: score tiers and pricing
A-lender rate tiers (2026 estimates)
| Credit Score | Rate Tier | 5-Year Fixed Rate Range | Rate Premium vs Best |
|---|---|---|---|
| 780+ | Top tier | 4.09%–4.29% | — (baseline) |
| 760–779 | Excellent | 4.14%–4.34% | +0.05% |
| 740–759 | Very good | 4.19%–4.39% | +0.10% |
| 720–739 | Good | 4.24%–4.49% | +0.15%–0.20% |
| 700–719 | Solid | 4.34%–4.59% | +0.20%–0.30% |
| 680–699 | Minimum A-lender | 4.44%–4.69% | +0.25%–0.40% |
B-lender rate tiers
| Credit Score | Rate Tier | 5-Year Fixed Rate Range | Premium vs A-Lender Best |
|---|---|---|---|
| 650–679 | Top B-lender | 5.50%–6.50% | +1.40%–2.20% |
| 600–649 | Mid B-lender | 6.00%–7.50% | +1.90%–3.20% |
| 550–599 | Lower B-lender | 7.00%–8.50% | +2.90%–4.20% |
| 500–549 | Bottom B-lender | 8.00%–10.00% | +3.90%–5.70% |
Private lender rates
| Credit Score | Rate Range | Premium vs A-Lender Best |
|---|---|---|
| Any score | 8.00%–15%+ | +3.90%–10.90%+ |
The dollar impact: what your score costs you
On a $400,000 mortgage (5-year term, 25-year amortization)
| Credit Score | Rate | Monthly Payment | 5-Year Interest Paid | Extra Cost vs 780+ |
|---|---|---|---|---|
| 780+ | 4.19% | $2,154 | $94,800 | — |
| 740 | 4.34% | $2,175 | $96,100 | +$1,300 |
| 700 | 4.49% | $2,197 | $97,400 | +$2,600 |
| 680 | 4.59% | $2,211 | $98,300 | +$3,500 |
| 650 (B-lender) | 6.00% | $2,418 | $115,100 | +$20,300 |
| 600 (B-lender) | 7.00% | $2,566 | $126,800 | +$32,000 |
| 550 (B-lender) | 8.00% | $2,718 | $138,900 | +$44,100 |
On a $600,000 mortgage (5-year term, 25-year amortization)
| Credit Score | Rate | Monthly Payment | 5-Year Interest Paid | Extra Cost vs 780+ |
|---|---|---|---|---|
| 780+ | 4.19% | $3,231 | $142,200 | — |
| 740 | 4.34% | $3,263 | $144,200 | +$2,000 |
| 700 | 4.49% | $3,295 | $146,200 | +$4,000 |
| 680 | 4.59% | $3,317 | $147,500 | +$5,300 |
| 650 (B-lender) | 6.00% | $3,627 | $172,600 | +$30,400 |
| 600 (B-lender) | 7.00% | $3,849 | $190,200 | +$48,000 |
| 550 (B-lender) | 8.00% | $4,077 | $208,400 | +$66,200 |
Lifetime cost on a $500,000 mortgage (25-year amortization)
| Credit Score | Rate | Total Interest (25 years) | Extra vs 780+ |
|---|---|---|---|
| 780+ | 4.19% | $294,000 | — |
| 680 | 4.59% | $327,000 | +$33,000 |
| 650 (B-lender, assume 2 years then A) | Blended ~4.80% | $347,000 | +$53,000 |
| 600 (B-lender, assume 3 years then A) | Blended ~5.20% | $381,000 | +$87,000 |
| 550 (B-lender, assume 5 years then A) | Blended ~5.60% | $418,000 | +$124,000 |
A 550 score vs 780 score can cost over $120,000 in extra interest on a $500,000 mortgage — even assuming you improve and refinance to A-lender rates within 5 years.
Why credit score affects rate
| Factor | How It Works |
|---|---|
| Default risk | Lower scores correlate with higher probability of missed payments |
| Insurance eligibility | Scores below 680 cannot access default insurance at most lenders, which raises the lender’s risk |
| Automated underwriting | Most A-lenders use automated systems with hard score cutoffs |
| Capital requirements | Regulators require lenders to hold more capital for riskier loans |
| Lender competition | High-score borrowers attract multiple offers, pushing rates down |
The 680 cliff
The single most important threshold in Canadian mortgage lending is 680. Above it, you’re an A-lender borrower. Below it, you’re in B-lender territory.
| Metric | Score 679 | Score 681 |
|---|---|---|
| Lender tier | B-lender | A-lender |
| Typical rate (5-yr fixed) | 5.50%–6.50% | 4.44%–4.69% |
| Lender fee | 0.50%–1.50% | $0 |
| Broker fee | 0.50%–1.00% | $0 |
| Monthly payment ($400K) | $2,418–$2,566 | $2,211–$2,238 |
| 5-Year interest | $115K–$127K | $98K–$101K |
A 2-point difference across the 680 threshold can save $15,000–$25,000 over a 5-year mortgage term. This is why credit optimization before a mortgage application is critical.
Beyond score: compensating factors
Lenders consider your full profile. Strong compensating factors can help offset a borderline score.
| Factor | How It Helps | Lender Impact |
|---|---|---|
| Large down payment (25%+) | Reduces LTV and lender risk | May offset 10–20 points of score weakness |
| Low debt ratios (GDS <30%, TDS <35%) | Strong repayment capacity | Improves manual underwriting decisions |
| Stable employment (5+ years) | Predictable income | Provides underwriter confidence |
| Significant savings/assets | Financial buffer | Demonstrates financial responsibility |
| Clean recent history | All payments current for 12+ months | Shows recovery and current reliability |
| Property quality | Desirable location, standard construction | Stronger collateral reduces lender risk |
What doesn’t help
| Factor | Why It Doesn’t Offset Score |
|---|---|
| High income | Income is assessed separately; doesn’t override poor credit history |
| Long credit history | Matters for the score itself, but past negatives still show |
| Good explanation for late payments | A-lender automated systems don’t accept explanations; manual review might |
Variable rate considerations
| Score Impact on Variable Rate | Detail |
|---|---|
| A-lender variable | Prime – discount (e.g., prime – 0.80%). Higher scores may get larger discount |
| B-lender variable | Prime + premium (e.g., prime + 1.50%–3.00%). Score determines the premium |
| HELOC | Prime + 0.50% to prime + 2.00%. Score affects the spread |
Strategies for getting the best rate at your current score
| Your Score | Best Strategy |
|---|---|
| 760+ | Shop aggressively — use a broker to find the absolute best rate |
| 720–759 | Standard shopping; you’ll get strong offers from most lenders |
| 680–719 | Focus on lenders where your score falls in a favourable tier; ask broker about discretionary pricing |
| 660–679 | Delay 2–4 months to push above 680 if possible; otherwise, best B-lender rate |
| 600–659 | Consider delaying 6–12 months to improve; if urgent, shop B-lenders through a broker |
| Below 600 | Focus on credit rebuilding; if purchase is urgent, accept B-lender/private as a bridge |
Quick wins to improve rate eligibility
| Action | Score Impact | Timeline |
|---|---|---|
| Pay credit cards below 30% utilization | +20 to +50 points | 1–2 billing cycles |
| Correct errors on credit report | +10 to +100 points | 30–90 days |
| Become authorized user on partner’s card | +10 to +30 points | 1–3 months |
| Stop applying for new credit | +5 to +20 points | 3–6 months |
| Pay off a collection (negotiate pay-for-delete) | +25 to +75 points | 30–60 days |
Related Pages
- Credit Score Needed for a Mortgage in Canada — Minimum requirements by lender type
- B-Lender Mortgage Canada — Options below the 680 threshold
- Debt Service Ratios (GDS & TDS) Explained — The other qualification factors
- How Long to Rebuild Credit — Timeline for credit recovery
- Best Credit Cards for Bad Credit — Rebuild your score
- Mortgage Guide Canada — Comprehensive overview
- First-Time Home Buyer Programs — Programs that help with affordability
- Mortgage Self-Employed Canada — Credit matters even more for self-employed borrowers