Skip to main content
Ratehub logo
Ratehub logo

Find the best mortgage rates in Canada

Get your personalized mortgage rate quote in under 2 mins

Best mortgage rates in Canada

To see the current best Canada mortgage rates from the Big 5 Banks, click on the "Best bank rates" tab.

Ratehub.ca Insights: Several lenders closed out the week with discounts to their fixed mortgage rates, as bond yields remain in the 3.6% range. Getting a pre-approval is recommended when shopping to lock in a rate for up to 120 days. Variable rates are unchanged.

As of:

Term
Fixed
Variable

2-yr

Compare all rates

Canadian Lender

3-yr

Compare all rates

Big 6 Bank

Prime - 0.90%

Canwise

A Ratehub Company

5-yr

Compare all rates

Big 6 Bank

Prime - 1.25%

Canadian Lender

WATCH: April 10, 2024 Bank of Canada announcement

Canada mortgage rates: Frequently asked questions

What is the best mortgage rate in Canada right now?


Will interest rates in Canada go down in 2024?


What is the lowest mortgage rate in Canadian history?


How does inflation affect mortgage rates in Canada?


How do I get the best mortgage rate in Canada in 2024?


What is Canadian Lender and Big 6 Bank?


Best Canada mortgage rates comparison

From 2006 - Today

Check out our tools to get started

May 2024: Mortgage market update

The early months of 2024 were volatile for the Canadian housing market, but there are early signs that sales activity will improve, as expectations rise that rate cuts could come from the Bank of Canada as early as the summer months.

Bond yields, however, continue to roller coaster up and down, as investors react to conflicting economic data reports. After tumbling in December and January, they're now in the upper 3% range, as markets are anxious over a “higher for longer” stance from the US Federal Reserve.

Overall, variable and fixed mortgage rates remain historically elevated. If you're shopping for a mortgage rate in Canada right now, here are some economic factors you should be aware of.

  • Real estate update: The latest April data, released by the Canadian Real Estate Association (CREA) on May 15, 2024, shows things have yet to heat up for Canada’s typically busy spring market. Home buyers largely stuck to the sidelines over the course of the month, causing sales to drop -1.7% from March, with a total of 37,745 transactions. On an annual basis, that is up 10%, though CREA largely attributes this increase to the timing of the Easter long weekend. However, while sales have slowed, the number of newly listed homes continues to grow; a total of 70,346 homes were brought to market, well outpacing that of sales. The result is a slowdown in the national average home price, which fell -1.8% year over year to an average of $703,446. New listings outnumbering sales has also resulted in better market balance – the national sales-to-new-listings ratio (SNLR) fell to 53.4%. This metric measures the level of competition within the housing market; a ratio between 45% and 65% is generally consistent with balanced housing market conditions, with readings above and below this range indicating sellers’ and buyers’ markets respectively.

    Read more: National home sales fall in April as buyers stick to the sidelines

  • CPI update: The April Consumer Price Index (CPI) report from Statistics Canada, released on May 21, 2024, shows steady progress continues to be made in reducing inflation’s growth, with the headline number coming in at 2.7%. That’s down from the 2.9% recorded in March, and is the lowest the inflation rate has been since March 2021. It also marks the fourth month in a row that the metric is within the Bank of Canada’s 1 - 3% target range, which is positive news for the Bank of Canada, which has been working to reduce the measure’s pace of growth. According to the report, food costs are on the decline, slowing to 1.4% in April, from 1.9% the previous month. However, gas prices rose during the same time period, with consumers paying 6.1% more at the pump on an annual basis. Shelter costs continue to be the largest contributor to inflation’s growth; mortgage interest costs are up 24.5% year over year, while rents rose 8.2%. Overall, however, the Bank of Canada should be encouraged by this month’s promising report; two of the central bank’s preferred metrics – called the CPI Median and CPI Trim – also lowered in April, to 2.6% and 3.2%, respectively. This should help pave the way for the BoC to cut its trend setting interest rate as early as its upcoming announcement on June 5th; markets are currently pricing in 50% odds.

Read more: Canadian CPI comes in at 2.7% in April


2024 Housing Market Forecast

CREA also updated its forecast for 2024 and 2025, due to growing expectations of rate cuts, and pent-up home buyer demand.

It anticipates a total of 492,083 homes will be sold in 2024, up 10.5% from 2023. Sales growth is expected to be strongest in provinces where housing demand has been consistent, such as Alberta. However, markets that have seen “historically low sales volume”, such as Ontario, BC, and Nova Scotia, will also see growth. The national average home price will rise by 4.9% to $710,468 in 2024.

Activity will continue to pick up steam in 2025, with sales to hit 530,494 units – an increase of 7.8%, and the national average home price to rise by 7% to $760,120.

Highlights from the Bank of Canada's April 10, 2024 announcement

At its third announcement of the year on April 10, 2024, the Bank of Canada kept its target for the overnight rate unchanged at 5.00% for the sixth time in a row.

  • A number of key economic indicators justified yet another rate hold by the Bank, including stalled economic growth and softening labour market conditions. The Bank is continuing its “wait and see” stance to ensure that inflation has been tamped down to the goal rate of 2%.
  • While the Bank noted that much progress has been made in the battle against inflation, it remained above the Bank’s target at 2.8% in February, and consequently, higher rates need to be maintained for longer to rein it in. The Bank wants to be certain that it does not cut rates prematurely and thus spur inflation to rise.
  • Anyone with a variable-rate mortgage or a home equity line of credit (HELOC) will need to continue to be patient, as the Bank has not moved up its timing of potential future rate cuts.
  • Although fixed mortgage rates are tied to the bond market and are thus not directly affected by the Bank of Canada’s rate hold, the Bank’s commentary does have an effect on the bond market. In the absence of any new information in the Bank’s announcement today and with this rate hold largely expected, lenders will likely maintain their fixed mortgage rates.
  • Canadians looking to buy a home or whose mortgage is up for renewal should get a rate hold now to protect themselves from any further rate increases. Should mortgage rates (namely fixed mortgage rates) go down during the time of your rate hold, you are still eligible for the lowest rate. 
  • This announcement is likely to have little effect on home values. The Bank’s stance has remained largely unchanged for the past several months, and the prospect of rate cuts before the latter part of 2024 remains virtually nonexistent.

Factors that can affect your mortgage rate in Canada

It’s important to understand that the best mortgage rate you qualify for may change depending on your unique borrowing profile. Here are some of the factors that influence what mortgage rate you qualify for:

The type of mortgage: If your mortgage is for a refinance, rather than a purchase or renewal, you’ll be eligible for higher rates. For individuals with an existing mortgage who have good credit and more than 20% equity in their homes, in addition to refinancing, you can also explore a home equity line of credit (HELOC).

Your down payment: If you’re purchasing a home and your down payment is less than 20% of the purchase price and the value of the home you are purchasing is less than $1 million, you’ll be required to purchase mortgage default insurance (sometimes known as CMHC insurance). This insurance is added to your mortgage amount and, while it will cost you money, it will result in a lower mortgage rate as your mortgage is less risky for your lender. If you’re renewing your mortgage, in order to be eligible for the lowest mortgage rates you would have needed to purchase CMHC insurance on the original mortgage. 

Your intended use of the property: Your mortgage rate will be higher if you plan to rent your property out vs. live in it as your primary residence.

Your amortization period: Insurable mortgages (i.e. mortgages for homes valued at less than $1 million with a down payment of less than 20% of the purchase price) in Canada have a maximum amortization period of 25 years. Regardless of the price of your home, if you make a down payment of at least 20%, you are able to access a mortgage that allows a longer amortization period, such as a 30-year period. While longer amortization periods will usually result in a lower monthly payment, they can come with a slightly higher interest rate. Moreover, by taking longer to pay back the mortgage, you will pay more in interest overall than you would with a shorter amortization period.

See today's best mortgage rates

Compare current mortgage rates across the Big 5 Banks and top Canadian lenders. Take 2 minutes to answer a few questions and discover the lowest rates available to you.

4.79%

Best fixed rate in Canada

see my rates

How to choose between a fixed or variable mortgage rate in Canada

Variable vs. fixed mortgage rates

The difference between fixed and variable mortgage rates is whether or not they will change over the term of your mortgage. Fixed rates will stay the same over the course of your mortgage term (usually 5 years), while variable rates will change alongside changes in your lender’s prime rate.

Fixed mortgage rates:

Fixed mortgage rates are a historically popular option, with 5-year fixed mortgage rates accounting for 80% of all mortgage requests made on Ratehub.ca from January to December 2023. Moreover, according to the 2024 CMHC Mortgage Consumer Survey, 69% of all mortgages contracted in 2024 were fixed-rate mortgages. The benefit of a fixed mortgage is that you are protected against interest rate fluctuations, so your regular payments stay constant over the duration of your term, regardless of what happens in the market. A fixed rate mortgage is ideal for you if you have a low appetite for risk. You’ll know how much you’ll be paying monthly right from the outset and not have to monitor interest rates.

Variable mortgage rates:

Variable mortgage rates are typically lower than fixed rates but can vary over the duration of your term. Variable mortgages are prone to market behaviour (via the prime rate) which affects your payments. That means your payment amounts can change over time. Variable rates remained substantially lower than fixed rates throughout 2021 and into 2022, leading a large number of buyers to opt for 5-year variable-rate mortgages. However, as variable-rate mortgages climbed to rates that are higher than fixed-rate mortgages over the course of ten rate hikes between March 2022 and July 2023, their popularity has substantially diminished. According to the 2024 CMHC Mortgage Consumer Survey, 23% of mortgages contracted during 2024 were variable-rate mortgages (down from 27% in 2023). 

While variable rates are generally lower, they do fluctuate and can be viewed as more risky when compared to fixed rates. Moreover, variable rates have actually been higher than fixed rates since the end of 2022. That said, variable mortgage rates have some key advantages you should know about:

  • You can convert a variable rate to a fixed rate at any time without a penalty as long as you stay with your original mortgage lender.
  • Breaking a variable rate mortgage is substantially less expensive than breaking a fixed rate mortgage. To estimate the cost of breaking your mortgage, our mortgage penalty calculator is a useful tool. 

According to York University Professor Moshe Milevsky’s landmark 2001 study, historically, over 90% of Canadians who have maintained a variable mortgage rate throughout their entire mortgage term have paid less in interest than those who have stuck to a fixed rate.

How to select the term for your mortgage rate

Choosing between a short-term mortgage or a long-term mortgage can also affect your interest rate. A short-term mortgage generally offers a lower rate, and, as it requires more frequent renewal, you can benefit from lower interest rates when you renew, if rates stay low at your renewal. Long-term mortgages, on the other hand, offer stability, as you won’t need to renew it often. However, long-term mortgage holders may not be able to take advantage of lower interest rates if the market fluctuates. 

Open vs. closed mortgages

If you’re wondering whether to get an open or closed mortgage, the answer is, while an open mortgage may make sense in certain circumstances, the overwhelming majority of Canadians opt for a closed mortgage. While open mortgages have extra flexibility that you might need, closed mortgages are by far the more popular choice not only due to their lower rates, but also because most home buyers do not intend to pay off their mortgages in the short term. Moreover, fixed-rate open mortgages do not exist and variable-rate mortgages are very rare. The most common type of open mortgage is the Home Equity Line of Credit (HELOC). Below are some quick facts about the differences between open and closed mortgages, and you can also find more detailed information on our blog about open vs. closed mortgages.

Closed mortgages:

Closed mortgages have lower rates compared to open mortgages. Closed mortgages can come in fixed and variable form, but place restrictions on the amount of principal you can pay down each year. If you pay off the entire principal in a closed mortgage before the set term, you will face a prepayment penalty, which is normally a 3-month interest charge.

Open mortgages:

Open mortgages allow you to pay off your entire mortgage balance at any time throughout the term. The drawback is that you pay a premium for that option in the form of higher rates. You might opt for an open mortgage if you are planning to move in the near future, or if you’re expecting a lump sum of money through an inheritance or bonus that would allow you to pay more of your mortgage off.

How do I qualify for a mortgage in Canada?

While it’s important to think about qualifying for the best rates, you should also give some thought to the basics that you’ll need to qualify and get approved for your mortgage. To qualify for a mortgage, here are some of the most important things that prospective lenders will want to see.  

A good credit score - You should have a credit score of 680 or higher to qualify for the best mortgage rates, but to qualify for a mortgage at all, you’ll need a credit score of at least 560. In addition to looking at your credit score, prospective lenders will also consider any derogatory information from your credit report, such as any missed payments (particularly if they have gone to collections). If you have bad credit, generally defined as a credit score of less than 660, you are unlikely to qualify for the best mortgage rates, and instead you’ll need to use a sub-prime mortgage lender like Equitable Bank or Home Trust. If your credit score is even less than 600, you will most probably need to use a private lender like WealthBridge. Sub-prime mortgage lenders are happy to work with people with a poor credit history, but they will charge higher mortgage rates. It's a good idea to have a detailed understanding of how your credit score affects your ability to obtain a mortgage.

Proof of income - You’ll also need to provide proof of income in the form of pay stubs and/or tax documents like your Notice of Assessment (NOA). Keep in mind that if you recently started a new job, even with proof of income, many lenders will want to see that you’ve held the position for at least a year. 

How the stress test impacts mortgage qualification

In Canada, anyone applying for a new mortgage loan must pass the mortgage stress test. The purpose of the stress test is to ensure the borrower could still manage to make their mortgage payments in the case that interest rates rise over the course of their term. The criteria for the stress test is a benchmark rate of 5.25% or the borrower’s contract rate plus 2% – whichever is higher. For example, if your lender offers you a mortgage rate of 5%, you’ll need to prove you could afford to make your payments at 7% in order to pass the test and qualify for your mortgage loan.

The standards for the mortgage stress test are upheld by the Office of the Superintendent of Financial Institutions (OSFI), Canada’s federal banking regulator, for low-ratio, uninsured mortgages. The criteria for high-ratio and insured mortgages is governed by the federal Department of Finance, though they follow exactly the standards put in place by OSFI.

All mortgage borrowers must be stress tested, with two exceptions:

  • Borrowers who are renewing their mortgage term at their original lender often are not re-stress tested.
  • Borrowers with high-ratio, insured mortgages switching to another lender at renewal may not be stress tested, as long as the original terms of their loan and amortization do not change.

Read more about Canada’s mortgage stress test:

Historical Canada mortgage rates

Looking at historical mortgage rates in Canada is a good way to understand which types of mortgage attract higher rates. They also make it easier to understand whether we’re currently in a low or higher rate environment, relatively speaking.

Here are some of the lowest Canada mortgage rates of the year for different types of mortgages over the past five years.

The knowledge bank

A wealth of knowledge delivered right to your inbox.

By submitting your email address, you acknowledge and agree to Ratehub.ca’s Terms of Use and Privacy Policy. Contact us for more information. You can unsubscribe at any time.

Is it worth working with a mortgage broker?

First, what exactly is a mortgage broker? Independent mortgage brokers are licensed mortgage specialists who have access to multiple lenders and mortgage rates. They essentially negotiate the lowest rate for you, and because they acquire high quantities of mortgage products, mortgage brokers can pass volume discounts directly to you. There are advantages to getting a mortgage directly from a lender as well as getting a mortgage through a broker, but there are differences between going with a bank vs. a mortgage broker. While going directly to your current bank lets you consolidate your financial products, using a broker allows you to shop around quickly and easily, at no cost to you.

Luckily, you don’t need to choose one or the other. You can speak to multiple banks and use a mortgage broker if you want to. Ratehub.ca is a great place to start, as we compare the best mortgage rates in Canada from multiple lenders. Once you’ve compared your options, we can put you in contact with your chosen provider.