Rates last updated: September 23, 2026. This guide covers Canadian mortgages. It is educational content, not financial advice.
Mortgage rates in Canada have shifted a lot over the past few years, and in 2026 the gap between fixed and variable rates is one of the widest borrowers have seen in a while. Whether you are buying your first home, renewing or switching lenders, knowing where rates stand today can save you thousands of dollars over your term.
On this page you will find the latest Bank of Canada rate, the prime rate, the best mortgage rates currently advertised in Canada, what they mean for your payments and how to qualify for the lowest rates available. We also explain the differences between insured and uninsured pricing, why big bank rates are often higher than broker rates, and how penalties can affect the true cost of a mortgage.
Canadian Mortgage Rates at a Glance
| Rate | Latest figure |
|---|---|
| Bank of Canada policy rate | 2.25% (held on September 2, 2026) |
| Prime rate at major lenders | 4.45% |
| Best advertised 5 year variable | around 3.25% to 3.30% |
| Best advertised 3 year fixed | around 4.19% |
| Best advertised 5 year fixed | around 4.09% to 4.24% |
| 5 year fixed on big bank websites | often in the mid 4% to low 5% range |
Sources: Bank of Canada, Ratehub.ca and WOWA.ca rate data for September 23, 2026. Best rates are usually for insured mortgages with strong applicants. Rates change daily.
What is happening to rates?
On September 2, 2026, the Bank of Canada held its policy rate at 2.25%, which kept the prime rate at major lenders at 4.45%. The Bank noted that headline inflation was hovering around 3%, pushed up mainly by gasoline prices linked to conflict in the Middle East, while core inflation remained close to 2%. It also pointed to trade uncertainty from new US tariffs. The next rate announcement is scheduled for October 28, 2026.
Fixed rates are moving differently. They follow Government of Canada bond yields rather than the Bank of Canada rate, and the five year bond yield has been climbing, recently sitting around 3.65%. That has put upward pressure on fixed mortgage rates, even while the policy rate stays on hold.
What Today’s Rates Mean for Your Payments
Here is the monthly payment on a $500,000 mortgage at different rates, with a 25 year and a 30 year amortization:
| Rate | Example | Monthly payment (25 years) | Monthly payment (30 years) |
|---|---|---|---|
| 3.25% | Best 5 year variable | $2,431 | $2,170 |
| 4.14% | Best 5 year fixed | $2,668 | $2,417 |
| 4.59% | Typical bank special | $2,792 | $2,547 |
| 5.14% | Higher bank rate | $2,948 | $2,710 |
Illustration only, using standard Canadian semi annual compounding. Your payment depends on your rate, amortization and payment frequency.
The difference between a best available fixed rate and a higher bank rate is roughly $280 a month on this loan, or more than $16,000 over a five year term. Shopping around really does matter.
Best Mortgage Rates by Term
| Term | What it offers | Who it may suit |
|---|---|---|
| 1 year fixed | Short commitment, usually a higher rate | Borrowers expecting rates to fall soon |
| 2 year fixed | Short term certainty | Those planning to move or refinance soon |
| 3 year fixed | Middle ground; often competitive in 2026 | Borrowers wanting certainty without a long lock in |
| 5 year fixed | The most popular term in Canada | Borrowers who want long term payment stability |
| 5 year variable | Lowest starting rate right now | Borrowers comfortable with rate changes |
| 10 year fixed | Maximum certainty, higher rate | Borrowers who value stability above cost |
The five year term remains the most common choice in Canada, but three year fixed terms have become popular with borrowers who want certainty without committing for the full five years.
Why the Variable Rate Is So Much Lower Right Now
Variable rates in Canada are priced as prime rate plus or minus a discount. With prime at 4.45%, a variable rate of 3.25% is equivalent to prime minus 1.20%. Because the Bank of Canada has cut its policy rate substantially from its 2023 peak, variable rates have fallen further than fixed rates.
Fixed rates, meanwhile, have been pushed higher by rising bond yields. The result is a gap of roughly 0.9 percentage points between the best variable and the best five year fixed rates. That makes variable mortgages look attractive, but they come with the risk that the Bank of Canada raises rates if inflation stays high. Our guide on fixed vs variable mortgages in Canada explains how to weigh this trade off.
Insured, Insurable and Uninsured Rates
Canadian lenders price mortgages differently depending on whether they are backed by mortgage default insurance:
| Category | What it means | Typical pricing |
|---|---|---|
| Insured | Down payment below 20%, with mortgage default insurance from CMHC, Sagen or Canada Guaranty | Usually the lowest rates |
| Insurable | 20% or more down, but meets insurance rules (for example, price under $1.5 million and amortization up to 25 years) | Slightly higher |
| Uninsured | Refinances, homes over $1.5 million, longer amortizations or rentals | Usually the highest |
It can seem strange that buyers with smaller down payments get lower rates, but insurance protects the lender, which reduces its risk. Keep in mind that insured borrowers pay an insurance premium, usually added to the mortgage, which offsets part of the rate advantage.
Rates for Different Situations
First time buyers. Since December 2024, first time buyers can choose a 30 year amortization on an insured mortgage, which lowers the monthly payment. On a $500,000 mortgage at 4.14%, that means about $2,417 a month instead of $2,668, although you pay more interest over time and a slightly higher insurance premium.
Renewals. If your term is ending, you can renew with your current lender or switch. Many borrowers who locked in at very low rates in 2021 are now seeing much higher renewal offers, which makes comparing lenders especially important.
Refinances. Refinancing to borrow more or consolidate debt is treated as uninsured, so rates are usually higher than for insured purchases.
Self employed borrowers. Rates can be similar to those for salaried borrowers if you can document your income, usually with two years of tax returns and Notices of Assessment. Alternative lenders are available for harder to document income, at higher rates.
Rental properties. Mortgages on investment properties usually carry higher rates and require larger down payments.
Big Banks vs Mortgage Brokers vs Monoline Lenders
In Canada, where you get your mortgage can affect your rate as much as your credit profile.
- Big banks (RBC, TD, Scotiabank, BMO, CIBC and National Bank) offer convenience and branch service. Their posted rates are usually higher than their best discounted rates, so it pays to negotiate.
- Mortgage brokers compare rates from many lenders, including banks, credit unions and monoline lenders. Brokers are often paid by the lender, so their service is usually free to the borrower.
- Monoline lenders only offer mortgages and are usually available through brokers. They often have very competitive rates and, in many cases, lower prepayment penalties.
- Credit unions can offer competitive pricing and flexible rules, and are regulated provincially.
How to Get the Best Mortgage Rate in Canada
1. Compare multiple lenders
Get quotes from your bank, at least one other lender and a mortgage broker. Rate differences of 0.3 to 0.5 percentage points are common.
2. Improve your credit score
A higher credit score gives you access to more lenders and better pricing. Many lenders look for scores of 680 or higher for their best rates.
3. Get a rate hold
Most lenders will hold a rate for 90 to 120 days while you shop for a home. If rates rise, you keep the lower rate; if they fall, you can usually take the lower one.
4. Negotiate at renewal
Your current lender will send a renewal offer before your term ends. It is often not their best rate. Compare it with other lenders, and remember that since November 2024, switching lenders at renewal without increasing your loan or amortization generally does not require you to pass the stress test again.
5. Consider the whole package
Look beyond the rate at prepayment privileges, penalties for breaking the mortgage, portability and whether the mortgage is a collateral or standard charge.
Checklist Before You Apply
- Check your credit score and correct any errors with Equifax and TransUnion.
- Work out your down payment and whether your mortgage will be insured, insurable or uninsured.
- Gather income documents, such as pay stubs, a job letter and recent Notices of Assessment.
- Estimate whether you can pass the mortgage stress test at your target price.
- Get quotes from your bank, another lender and a mortgage broker.
- Ask about prepayment privileges, penalties and portability, not only the rate.
- Secure a rate hold once you are ready to shop for a home.
Understanding Mortgage Penalties
Breaking a mortgage early can be expensive, especially on a fixed rate:
- Variable rate mortgages usually charge three months of interest.
- Fixed rate mortgages usually charge the greater of three months of interest or the interest rate differential (IRD). At big banks, IRD penalties can be very large because they are calculated using posted rates.
If there is a chance you will sell, move or refinance before your term ends, the penalty rules may matter as much as the rate.
Recent History: How Did We Get Here?
In 2020 and 2021, Canadian mortgage rates hit record lows, with some five year variable rates below 1% and fixed rates below 2%. As inflation surged, the Bank of Canada raised its policy rate rapidly, reaching 5.00% in July 2023. Many variable rate borrowers saw payments rise sharply, and some reached their “trigger rate”.
The Bank began cutting in 2024, bringing the policy rate down to its current 2.25%. Variable rates have fallen with it, while fixed rates have stayed higher because of bond yields. Many borrowers who locked in five year terms in 2021 are now renewing at noticeably higher rates.
Frequently Asked Questions
What is a good mortgage rate in Canada right now?
As of late September 2026, the best advertised five year fixed rates are around 4.1% to 4.25%, and the best five year variable rates are around 3.25% to 3.30%. Your rate will depend on your down payment, credit score, property and whether the mortgage is insured.
Will mortgage rates go down in Canada?
Nobody knows for sure. The Bank of Canada held rates in September 2026 but flagged upside risks to inflation from energy prices. Fixed rates also depend on bond yields, which have been rising.
Why are big bank rates higher than broker rates?
Banks often advertise posted or special rates that are higher than their best discretionary rates. Brokers and monoline lenders compete mainly on price, so their advertised rates tend to be lower.
Is a 3 year or 5 year fixed better?
It depends on your plans and outlook. A three year term offers a shorter commitment, while a five year term gives longer protection. In 2026, the rates are close, so flexibility may be the deciding factor.
Can I negotiate my mortgage rate?
Yes. Canadian lenders often have room to lower their offer, especially if you have strong credit, a solid down payment and a competing quote in hand. Bringing a written offer from a broker or another lender is one of the most effective ways to negotiate.
What is the prime rate?
The prime rate is the benchmark rate that Canadian lenders use to price variable rate mortgages and lines of credit. It usually moves in step with the Bank of Canada’s policy rate and currently stands at 4.45% at major lenders.
Is a 30 year amortization worth it?
It lowers your monthly payment, which can help with affordability, but you will pay more interest over the life of the loan. It can make sense if cash flow is tight, especially if you plan to make prepayments when you can.
How often do mortgage rates change?
Lenders can change rates daily. The Bank of Canada makes eight scheduled rate announcements each year, which directly affect variable rates.
The Bottom Line
As of September 23, 2026, the Bank of Canada rate is 2.25%, prime is 4.45%, the best five year variable rates are around 3.25% to 3.30% and the best five year fixed rates are around 4.1% to 4.25%. Variable rates currently start much lower, but fixed rates offer protection if inflation pushes rates higher.
To get one of the best rates, compare several lenders, use a mortgage broker, secure a rate hold and negotiate at renewal. Always look at penalties and prepayment options alongside the rate itself, and make sure your payment would still be comfortable if rates moved higher at renewal.
Disclaimer: This article is for general educational purposes only and does not constitute financial advice. Rates are sourced from the Bank of Canada and public rate comparison data for September 23, 2026, and are not offers of credit. Your rate will depend on your circumstances and the lender. Always confirm current rates and terms with a licensed mortgage professional.