How much below my bank's posted rate should my mortgage rate be? (Canada)

In Canada, there is no fixed answer, because no official or published "normal" discount from your bank's posted rate exists, and we do not quote one. Many borrowers sign below the lender's advertised posted rate, and the gap depends on the lender, the term, your finances and the week you ask. The useful test is how your rate compares with written offers from other lenders for the same mortgage, not the size of the discount.

The posted rate and the rate you sign

A lender's posted rate is the rate it publishes for each term. The discounted rate is the one in your contract, and the discounted rate is what sets your payment. Many lenders discount from posted, and the size of the discount is the lender's decision, not a published formula.

The public reference point comes from the Bank of Canada, which publishes the chartered banks' posted five-year conventional mortgage rate every week as series V80691335 (source: Bank of Canada, fetched October 2026). The series shows what the big banks post, not what any borrower pays. Our posted vs discounted page charts that series and explains the gap.

Why there is no standard discount

Discounts generally vary with things the posted rate does not show:

• the term, and whether the rate is fixed or variable;
• whether the mortgage is insured or uninsured;
• the amortization and the size of the loan;
• how long the rate is held;
• your credit, your income and the property;
• the week you ask, because lenders often change the rates they offer.

A single "normal discount" quoted online is someone's sample, not a rule. Two neighbours with the same bank can be offered different discounts on the same day.

The discount matters twice

The discount matters first in every payment. The discount matters again if you break the mortgage before the term, the length of your contract, ends. On a fixed mortgage the penalty is usually the higher of three months' interest or the interest rate differential (IRD), and lenders may use posted rates to calculate it (source: Financial Consumer Agency of Canada, checked October 2026).

Many lenders that use posted rates subtract the discount you got at signing from today's posted rate, so a bigger discount can mean a bigger penalty if you break early. Our page on posted vs discounted rates and your penalty shows the arithmetic.

Under the federal Code of Conduct on mortgage prepayment information, federally regulated lenders explain how the charge is calculated and, for IRD charges, how the comparison rate is set (source: Financial Consumer Agency of Canada, checked October 2026). Before you sign, ask how your comparison rate is set.

What a small gap is worth

Illustrative, not a quote. On a $500,000 mortgage, a difference of 0.10 percentage points is about $500 of interest in the first year (0.10 percentage points of $500,000). The saving is a little less in each year after, as the balance falls. Over a five-year term the gap is worth a little under $2,500.

Small gaps add up, which is why comparing written offers tells you more than the discount on paper.

What we will publish about discounts

After launch, we will publish a monthly median discount from posted on the offers we review, by term, from aggregates only, with the method and the date, on our posted vs discounted page. Until we have that data, we do not state a number.

What to do next

Enter your offer in the offer check to see how its terms score, or go to Can your bank do better? and we will compare your rate with what the lenders we work with would offer on the same mortgage.