Number of Years
Fixed or Variable
The 5-year fixed mortgage is Canada's most popular residential mortgage term. According to Statistics Canada, the 5-year fixed mortgage accounted for almost 50% of all mortgages in Canada and more than all variable rate mortgages combined. If you are looking for a new mortgage, planning on switching to a different lender, or refinancing, the 5-year fixed mortgage is the best place to start.
The 5-year fixed mortgage rate has generally gone down over the past 4 decades. In 1981, it peaked at 21.75% as Canada went into a period of stagflation marked by low economic growth and high inflation. It is now back to near record-lows at 4.74% as monetary stimulus and quantitative easing preempted by COVID-19 drove the Bank of Canada interest rate and the Prime Rate down to 0.25% and 2.45%, respectively.
The chart above tracks the posted rate of the top banks in Canada: RBC, TD, BMO, Scotiabank, CIBC, and National Bank. This is the rate that they use to calculate their mortgage break penalty, or the fees you pay when you break your mortgage. It is also used as the Qualifying Rate for the mortgage stress test by the CMHC.
The discounted mortgage rates that are offered by lenders can often be lower than their posted rates, however. Many lenders offer promotional rates or cashback incentives for new clients, but these are usually temporary and apply only to prime borrowers.
Mortgage rates in Canada can differ from province to province depending on the availability of lenders, local housing market and mortgage conditions, and provincial regulations. While the Big 5 Banks offer mortgages in every province, many smaller lenders including credit unions, B lenders, and private mortgage lenders often operate in a single province only. A lender offering the best rate in Ontario may not be available in Saskatchewan, for example. Similarly, a smaller number of lenders in a province could mean less competition, leading to higher rates in general.
|Province||Best 5-Year Fixed Rate|
Prince Edward Island
Newfoundland & Labrador