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Fixed or variable? See how each plays out

Nobody knows where rates in Canada will go. Pick a path for prime and see the payments, the interest and what you'd owe after five years under each choice.

From your quote

From your quote

Enter the fixed and variable rates you've been offered to run the comparison.

Posted 5-year fixed vs prime, 2000–20265-year conventional (posted)Prime rate
0%2%4%6%8%10%200020052010201520202025

Source: Bank of Canada, series V80691335 and V80691311 (first weekly value of each month; last observation 2026-10-28). Posted rates published by the Bank of Canada, not a quote; most borrowers are offered a lower, discounted rate.

How this tool works

  • Variable payments are reset each year over the remaining amortization (an adjustable-payment variable). Fixed-payment variables keep the payment and change how much goes to interest.
  • The variable rate moves by the same amount as prime at the start of each year.
  • Canadian fixed-rate mortgages compound semi-annually; the tool uses that convention for both.
  • The history chart uses Bank of Canada series: the chartered banks' 5-year conventional (posted) mortgage rate and the prime rate. Posted rates are not quotes — most borrowers are offered less.

Rules checked 2026-10-23. Estimates only, not an offer or advice; a licensed broker confirms the numbers and every mortgage is subject to lender approval. Everything is calculated in your browser. The amounts you type are never sent to us.

Questions about the fixed vs variable over time tool

Is variable usually cheaper?

Over some periods it has been, and over others it hasn't. The question to ask is how much payment change you can live with, and the penalty each option carries if you break it.

What's a trigger rate?

The rate at which your payment covers only the interest, on a fixed-payment variable mortgage. Above it, the balance can grow until the lender requires a higher payment.

Can I switch from variable to fixed later?

Many lenders let you lock into a fixed rate during the term, usually at their rate for the remaining term. Check the terms before you sign.

More tools: Renewal vs switch · Compare your offers · Prepayment savings · Offer check · Payment shock at renewal

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