Find the best 3-year fixed mortgage rate
We’ll find the best rates for you in less than 2 minutes.
Bank of Montreal
Big 6 Bank
Meridian Credit Union
RBC Royal Bank
Simplii Financial ™
Compare the best rates
Answer a few quick questions and see the lowest rates you can qualify for.
Apply for your mortgage instantly and easily using our secure online application.
Connect with our mortgage advisors
Questions or comments? Book a call and one of our mortgage advisors will walk you through all the details
What are 3-year fixed mortgage rates?
How much can I save comparing 3-year fixed rates?
Why compare 3-year fixed rates with Ratehub.ca?
Why are fixed rates different to variable rates?
Are 3-year mortgages better than other mortgage terms?
Check out the best current mortgage rates
Jamie David, Director of Marketing & Mortgages
Three-year mortgage terms are not very common in Canada, but they do make sense under certain circumstances. Here's what you need to know to decide whether a 3-year mortgage is right for you.
What is a 3-year fixed-rate mortgage?
A 3-year fixed-rate mortgage will have a constant rate of interest over a term of three years. The term should not be confused with the amortization period, which is the length of time it takes to pay off your mortgage. The term, rather, is the period you are committed to the contractual provisions and mortgage rate with your lender.
3-year fixed mortgage rates: Quick facts
- Mortgage rate is fixed over a 3-year term
- 72% of Canadians had fixed mortgage rates in 2020 (Source: Mortgage Professionals Canada)
- 3-year fixed mortgage rates closely follow 3-year government bond yields
Comparing 3-year fixed mortgage rates
There are a number of factors supporting the choice of a short-term rate like the 3-year fixed mortgage rate. For one, if you believe you are in a falling interest rate environment, where rates will stay stagnant or fall, shorter terms can be a good choice. Instead of being locked into a rate for five or more years, you can take advantage of low rates when your mortgage is up for renewal. Conversely, if you are in a rising interest rate environment, the opposite is true.
Short terms are also sensible if you are likely to break your mortgage within a few years – if you are thinking about renovating or selling your home, for example. Going with a 3-year term over a 5-year term could save you a considerable amount of money in penalty costs.
3-year fixed vs. longer-term mortgage rates
3-year fixed rates are typically slightly lower than rates on longer terms (like 5 or 10 years) and higher than rates on short terms, like 1-year rates. This is because longer fixed-rate terms lock in a lower rate for a longer period of time. That might be great for you, but it puts the risk of a rate rise onto your lender. The higher rate is, therefore, a premium for locking in a lower rate for longer.
These relationships aren't always constant, however, especially in very low or high rate environments. You should always decide which term is best for you based on the current market and your present circumstances.
3-year mortgage rates vs. other term lengths (graph)
From 2006 - Today
Historical 3-year fixed mortgage rates
Looking at mortgage rates over time is the best way to understand which mortgage terms attract lower rates. They also make it easier to understand whether rates are currently higher or lower than they have been in the past.
Here are the lowest 3-year fixed rates in Canada of the year for the last several years, compared to several other types of mortgage rates.
Source: Ratehub Historical Rate Chart
The popularity of 3-year fixed mortgage rates
While 5-year terms are the most common duration amongst all Canadians, younger Canadians are more likely to gravitate towards mortgage terms of between two and four years. As is typical with younger demographics, the tolerance for risk is likely higher, with a reduced urgency to lock in rates for longer periods of time.
Fixed rates are also more common than variable rates, representing 72% of total mortgages. In terms of age dispersion, fixed-rate mortgages are slightly more common for the youngest age groups, and older age groups are more likely to choose variable-rate mortgages.
What drives changes in 3-year fixed mortgage rates?
Fixed mortgage rates follow government bond yields, with 3-year fixed rates following 3-year government bond yields. Bond yields are driven by economic conditions, and the spread between bond yields and lender-posted mortgage rates vary by a lender's marketing strategy and general credit market conditions.
Jamie David is the Business Director of Mortgages at Ratehub.ca. A graduate of the Systems Design Engineering program at the University of Waterloo, she has over 15 years of business, marketing, and engineering experience in the financial technology, banking, education, energy and retail industries. She has worked in top organizations like TD Bank, Trading Pursuits, Petro-Canada, and the TTC. Her passion for personal finance, investing, education, and business strategy brought her to Ratehub.ca where she heads a very talented, cross-functional team that is dedicated to providing Canadians with the best mortgage experience all the way through from online search to (keys-in-your-hand) funded mortgage.read linkedin bio
Whether you need a mortgage, credit card, savings account, or insurance coverage, we help you find and compare the best financial products for your specific needs.
When it comes to mortgages, Ratehub.ca is more than just the place to research and compare the best rates. Get your mortgage at Ratehub.ca and have the best of both worlds – online rates and award-winning customer service.
Ratehub.ca has been named Canada's Mortgage Brokerage of the Year for four years straight (2018-2021). With over 12 years of mortgage experience, and $11 billion in mortgages funded, we deliver you the best mortgage experience in Canada, from online search to close.
How does Ratehub.ca make money?
Financial institutions pay us for connecting them with customers. This could be through advertisements, or when someone applies or is approved for a product. However, not all products we list are tied to compensation for us. Our industry leading education centres and calculators are available 24/7, free of charge, and with no obligation to purchase. To learn more, visit our About us page.
How are CanWise Financial and Ratehub.ca connected?
We own and operate a mortgage brokerage, Ratehub.ca (formerly known as CanWise Financial), and are compensated for mortgages funded through our brokerage. Ratehub Inc. o/a Ratehub.ca & CanWise is a licensed mortgage brokerage and CMHC-approved lender. When comparing mortgage rates on Ratehub.ca, you’ll see rates from a number of lenders, including CanWise. All products are sorted according to the rates available to you and the selection criteria you’ve shared with us. Both Ratehub.ca and CanWise are owned and operated by Ratehub Inc.
We’re proud of our Ratehub.ca mortgage brokerage, which offers our users great rates, trusted advice and an award-winning team of mortgage experts. Read any of our 6,700 five-star Google and Facebook reviews and you’ll see what we mean.