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Compare Bank of Montreal (BMO) Mortgage Rates in Canada

Compare BMO Mortgage Rates in Canada

The Bank of Montreal, or BMO, is Canada’s oldest bank and one of the largest banks in North America today. Offering a range of conventional residential mortgage products, BMO is considered one of the Big Five Canadian banks. Along with other institutions like CIBC, Scotiabank, and Nesto, it is classed as an A-lender. In this article, we lay out BMO’s main mortgage solutions, rates, and flexibility options.

Key Highlights

  • BMO offers closed, open, and convertible mortgages.
  • BMO offers up to 20% prepayment options on their mortgages.
  • BMO has a fairly straightforward renewal process; however, you can also renew your mortgage with a new lender if you find a better rate elsewhere.

Compare Bank of Montreal (BMO) Mortgage Rates

Here’s a breakdown of mortgage rates from the Big Banks. In this table, you’ll see the current rate for different terms and types of mortgages and how they each compare to different banks. When you’re comparing mortgage rates, it’s generally a good idea to compare rates from multiple lenders at once and look for the lowest possible rate since you could save thousands over the lifetime of your loan with a bit of research in advance.

Top 5 Big
Bank Rates

The top 5 big bank rates are all in one easy-to-view table. See their rates, then beat their rates (or get $500) with nesto’s low rate guarantee.

*Toronto rates

How to Compare Bank Rates From Big Banks

When you compare rates from banks like BMO and the other Canadian Big Five banks, you’re generally talking about conventional lenders, who have some of the lowest rates available compared to private and other alternative lenders. (There are a range of different lender types in Canada.) 

When you’re looking for the best rate, A-lenders like nesto and the Big Five update their rates regularly based on changes in the Bank of Canada’s key interest rate. Ultimately, you want to go for the lowest rate possible since a lower interest rate could save you thousands over the lifetime of your mortgage. The best way to compare rates is to check out multiple lenders at once and see what’s available. You also want to make sure you find a mortgage solution that works for your situation, and it helps to know the pros and cons of fixed versus variable rate mortgages, as well as other different types of mortgages in Canada. 

Finally, if you’ve found a rate from a lender other than nesto, we guarantee that we’ll match or beat it, or you could get $500. Learn more about nesto’s low rate guarantee.

BMO Overview & Stock Information

The Bank of Montreal was founded in 1817 and was Canada’s first bank. Today, the bank serves over 10 million individuals, institutions, and corporations worldwide, with its primary customer base located in North America. BMO is a popular choice for Canadian residential mortgages as one of the Big Five Banks. Listed on the stock exchange as BMO, shares in the company have traded roughly between $125.00 and $150.00 Canadian for the last year, with share value trending gradually and steadily downwards since this time last year. The company’s CEO is currently Darryl White, who has been serving as the chief executive officer since November 2017. 

BMO Prime Rate

As of Friday, June 21, 2024, BMO’s prime rate is . The Prime rate (or, more simply, Prime) is used as a basis for a number of products like variable mortgages, credit lines, and credit cards. A Prime rate is the interest rate that commercial banks charge customers that represents the lowest level of risk. Prime rates are combined with a positive or negative spread (e.g. +/- 1.5%) for most lending products, depending on risk levels. Each bank sets the prime rate to determine the interest they charge customers. Although each bank sets its own prime rate, they generally try to keep their rates in line with each other.

Here’s a snapshot of the Prime Rate over time.

*Most Recent Prime Rate Shown

BMO 5-Year Fixed and Variable Rate History

BMO is one of the largest banks in Canada and has consistently had competitive mortgage rates in both the fixed and variable rate categories. Historically, BMO’s 5-year fixed and variable rate mortgages have generally followed national trends related to rising and falling interest rates, as set by the Bank of Canada. BMO’s variable rate mortgages can be converted to a fixed rate at any time, although if you are converting your mortgage to a fixed rate, you may not be able to get the best rate automatically.

We don’t track historical rates at BMO. 5-year mortgage rates are the most popular in Canada, with people switching between fixed and variable depending on market trends. Analyzing the Bank of Canada chart below can help you choose between a fixed or variable 5-year mortgage rate in today’s market.

Bank of Canada Policy & Prime Rate Changes

Date of Rate ChangeKey Overnight Target Rate (%)Change (%)Bank Prime Rate
June 2, 20100.30%0.25%2.50%
July 21, 20100.55%0.25%2.75%
September 9, 20100.80%0.25%3.00%
January 28, 20150.65%-0.15%2.85%
July 16, 20150.50%-0.15%2.70%
July 13, 20170.75%0.25%2.95%
September 7, 20171.00%0.25%3.20%
January 18, 20181.25%0.25%3.45%
July 12, 20181.50%0.25%3.70%
October 25, 20181.75%0.25%3.95%
March 5, 20201.25%-0.50%3.45%
March 17, 20200.75%-0.50%2.95%
March 30, 20200.25%-0.50%2.45%
March 3, 20220.50%0.25%2.70%
April 14, 20221.00%0.50%3.20%
June 2, 20221.50%0.50%3.70%
July 14, 20222.50%1.00%4.70%
September 7, 20223.25%0.75%5.45%
October 26, 20223.75%0.50%5.95%
December 7, 20224.25%0.50%6.45%
January 25, 20234.50%0.25%6.70%
March 8, 20234.50%0.00%6.70%
April 12, 20234.50%0.00%6.70%
June 7, 20234.75%0.25%6.95%
July 12, 20235.00%0.25%7.20%
September 6, 20235.00%0.00%7.20%
October 25, 20235.00%0.00%7.20%
December 6, 20235.00%0.00%7.20%
January 24, 20245.00%0.00%7.20%
March 6, 20245.00%0.00%7.20%
April 10, 20245.00%0.00%7.20%
June 5, 20244.75%0.25%6.95%
The Bank of Canada (BoC) will deliberate on the Key Overnight Target rate twice every quarter. Generally, all lenders will follow suit to keep their prime rates in line with the country’s Big Six chartered banks. Find below the most recent changes to the baseline, which impacted the spreads to the Big Banks Prime Rates.
You can learn more about this topic by understanding how the Bank of Canada Policy Rate works.

BMO Mortgage Products

BMO offers a range of mortgage solutions, from fixed to variable and convertible mortgages. They have a fairly conventional offering of residential mortgages, with competitive rates and decent prepayment flexibility. Here’s a breakdown of BMO’s main residential mortgage products.

Fixed Rate Closed Mortgage

BMO offers fixed-rate closed mortgages, which lock in your interest rates for the duration of your term, making your monthly payments the same regardless of fluctuations in interest rates. BMO offers 1 to 10-year terms, with Smart Fixed options available for 5 and 10-year terms. Rates vary depending on whether you get an amortization period of less or more than 25 years.

Open Fixed Rate Mortgage

Open fixed-rate mortgages from BMO are useful if you plan to make prepayments of more than 20% of your original mortgage principal or if you plan to sell your home in the near future. Interest rates with open fixed-rate mortgages are generally higher to allow for this additional flexibility.

Variable Rate Mortgage

With a variable-rate mortgage, while your payments remain the same, the amount applied to your principal can fluctuate with BMO’s prime lending rate. Variable-rate mortgages historically perform better than fixed-rate mortgages in terms of total repayments; however, if interest rates fluctuate significantly, your payments may increase comparatively more. BMO offers 3-year open and 5-year closed variable-rate mortgages.

Convertible Fixed Rate Mortgage

A convertible fixed-rate mortgage offers similar benefits to a closed mortgage but with the added flexibility of changing to a fixed-rate term of one year or longer without a prepayment charge. Convertible mortgages are useful if you want to change your term shortly after buying your house or if your financial situation evolves.

BMO Homeowner ReadiLine®

BMO Homeowner ReadiLine® is essentially a mortgage and a line of credit in one. With this product, you can borrow up to 80% of your home’s value, with the option to split between a mortgage and a line of credit. As you pay off the mortgage, the principal you repay will increase the limit available on your line of credit. This option is great if you’re looking to use your equity to make further improvements on your house or to consolidate other debts at a lower interest rate by paying them off with your credit line.

BMO Mortgage Payment Increases

In mortgage terms, prepayment describes when a borrower pays off some or all of their mortgage early, with a lump sum payment, or by increasing their monthly payments. Each major bank has different amounts you can pay off each year on your mortgage. Some mortgages come with more attractive prepayment options, so it’s worth looking into if you want the flexibility of being able to pay back your mortgage early. BMO offers fairly generous prepayment terms, with up to 20% on many of their mortgage products. This means that you are able to increase your monthly repayments by up to 20% once each calendar year to help pay down your mortgage faster. BMO offers a range of mortgage payment increase options, including:

Accelerated payments

With BMO, you can increase your mortgage payment once per calendar year (depending on your type of mortgage) by up to 10% with a BMO Smart Fixed Mortgage or 20% for any other kind of BMO closed mortgage.

Alternatively, you can make lump-sum prepayments each year without a prepayment charge, up to 10% of the original mortgage amount for a BMO Smart Fixed Mortgage or 20% of the original mortgage amount for any other BMO closed mortgage.

Increased payment frequency

BMO customers can switch from monthly mortgage payments to an accelerated weekly or bi-weekly schedule, which can help them save money in the long run.

Increased payment and reduced amortization

You can choose to increase the amount of your regular mortgage payment (principal and interest) by up to 20% (10% with a BMO Smart Fixed Mortgage) without any additional charge. BMO customers can do this once in every calendar year. Paying more each month will shorten your amortization period and can reduce your interest costs over time.

BMO Annual Mortgage Prepayment

Here’s a breakdown of the Big Six banks and their prepayment amounts. As you can see, BMO offers one of the highest prepayment amounts of any of the other major banks, at 20%. However, the setup of BMO’s prepayment amounts varies depending on the type and term of your mortgage. For example, a BMO Smart Fixed Mortgage has a 10% prepayment amount rather than 20%.

Canadian Bank Closed Mortgage Prepayment Amounts
TD Bank15%
National Bank10%

Renewal Process With Big Banks

With BMO, if you’re renewing with the same lender, the process involves getting in touch with the bank directly to explore your renewal options. However, the renewal process often raises questions like whether you must renew your mortgage with your current bank. The answer is no, you do have the choice to renew at the end of your term with any bank or mortgage provider. If you’re looking to renew your current BMO mortgage with another lender, it’s worth shopping around for better rates and terms that suit your situation before you renew with the same lender.

At nesto, we help you find the best rates available on your mortgage, and we also lend directly. Our simple renewal process guide explains in more detail how to renew your mortgage with a new lender. To get started and renew your mortgage with nesto, start by finding the best rate available near you at least a couple of months before your current term is due to expire. Once you’ve found a solution you’re interested in, simply get in touch, and a mortgage advisor will help you through the process. Renewing with nesto is a simple, hassle-free process that could save you thousands over the lifetime of your mortgage compared to the Big Banks. 

Frequently Asked Questions

Here are some of the recently commonly asked questions about BMO’s mortgage offerings and rates. 

Are BMO rates lower than those of other big banks?

Historically, BMO’s rates have been more or less competitive with those of the other big Canadian banks. BMO’s fixed and variable rate mortgages are in line with those of the other Big Five lenders, with variations in posted interest rates measurable in tenths of a percentage. BMO’s 5-year fixed rate mortgage rate for a default-insured mortgage is roughly the same as that of other banks.

What are the benefits of choosing a smaller lender?

Some smaller lenders, like credit unions and other alternative lenders, may be able to offer lower rates than big banks like BMOs. However, big banks and other A lenders typically have more stringent lending criteria that allow them to offer lower rates than you can find elsewhere because they opt for less risky borrowers. Smaller lenders may be able to offer mortgages to people with unique employment situations or poor credit, but they may charge higher interest rates as a consequence.

How do I get a mortgage with BMO?

BMO suggests getting in touch with one of their mortgage advisors to talk about your loan. The bank offers quick online pre-qualification tools, and you can start applying for a mortgage with BMO online. At nesto, we can help you compare the best rates from BMO and other big banks to find the best rate possible – we also lend directly.

Final Thoughts

BMO is one of Canada’s oldest and largest banks, and it makes up one of the Big Five or Big Six Canadian banking institutions. The bank offers a range of conventional mortgage products for residential customers and rates that align with other big banks and A-lenders. BMO offers decent prepayment options for many of their mortgage products and some flexibility in the form of convertible mortgages and open mortgages. Ultimately, if you’re looking to find the best rate possible with the big banks, look at multiple lenders first to see who offers the lowest rate possible.

Why choose nesto

At nesto, our commission-free mortgage experts, certified in multiple provinces, provide exceptional advice and service that exceeds industry standards. Our mortgage experts are non-commissioned salaried employees who provide impartial guidance on mortgage options tailored to your needs and are evaluated based on client satisfaction and advice quality. nesto aims to transform the mortgage industry by providing honest advice and competitive rates using a 100% fully digital, transparent, seamless process.

nesto is on a mission to offer a positive, empowering and transparent property financing experience – simplified from start to finish.

Contact our licensed and knowledgeable mortgage experts to find your best mortgage rate in Canada.