Bank of Canada Paused the Policy Rate at 2.25%
Best Fixed Mortgage Rates in Canada
Today’s Best Fixed Rates. Last updated June 18, 2026
Fixed mortgage rates in Canada track Government of Canada (GoC) bond yields, not the Bank of Canada’s policy rate, so they can move even when the Bank holds its benchmark overnight rate steady.
No rates at the moment
No rates at the moment
*Insured loans. Other conditions apply. Rates in effect as of today (Thursday, June 18, 2026).
Current Fixed Mortgage Rates in Canada
National Fixed Mortgage Rate Trends for Today
For Thursday, June 18, 2026:
Canada’s average 3-year conventional fixed mortgage rate is 4.91% . The best conventional 3-year fixed rate is
Canada’s average 5-year conventional fixed mortgage rate is 5.07%. The best conventional 5-year fixed rate is
Note: one basis point is 1/100th of a percentage point, or 0.01%.
What are the average fixed mortgage rates in Canada today?
As of Thursday, June 18, 2026, the following are the most competitive average conventional fixed rates across Canada, offered to borrowers putting 20% or more down. Conventional rates are generally higher than high-ratio rates but do not require mortgage default insurance.
- 2-year fixed mortgage rate:
4.80% - 3-year fixed mortgage rate:
4.91% - 4-year fixed mortgage rate:
5.42% - 5-year fixed mortgage rate:
4.93% - 7-year fixed mortgage rate:
5.76% - 10-year fixed mortgage rate:
6.78%
What are the lowest fixed mortgage rates in Canada today?
As of Thursday, June 18, 2026, high-ratio rates, offered to borrowers with a down payment of less than 20% who purchase and carry mortgage default insurance, are the lowest available. The following high-ratio fixed rates are accessible across Canada:
- 2-year fixed mortgage rate: 4.64%
- 3-year fixed mortgage rate: 4.14%
- 4-year fixed mortgage rate: 4.29%
- 5-year fixed mortgage rate: 4.09%
- 7-year fixed mortgage rate: 6.19%
- 10-year fixed mortgage rate: 7.74%
Posted & Prime Rate History
Here’s a historical overview of changes in the posted and prime rates at Canada’s chartered banks since 1980.
Source: bankofcanada.ca
How Fixed Mortgage Rates Work in Canada
Fixed mortgage rates in Canada are priced off Government of Canada (GoC) bond yields, not the Bank of Canada’s policy rate. Lenders fund fixed mortgages in the bond market, so the GoC bond of a similar term, the 5-year, is the key benchmark, sets the floor, and fixed rates track it, usually after a short lag. This is the single most important concept to understand about fixed rates, because a steady Bank of Canada policy rate does not mean fixed rates will also hold steady.
Several forces move those yields. Canadian bond yields take much of their direction from US Treasury yields, which Bank of Canada staff research finds drive Government of Canada (GoC) bond yields more than domestic economic news does. Inflation and inflation expectations push yields up when investors expect consumer prices to rise, and expectations about future Bank of Canada policy matter just as much. When markets expect holds or hikes rather than cuts, yields stay elevated. Safe-haven demand for bonds can pull the other way, as foreign money moving into Canadian bonds pushes yields down.
A further force is the term premium, the extra yield investors demand to hold longer-dated bonds, which Bank of Canada research notes has widened to its highest level in over a decade, adding structural upward pressure on fixed rates.
This is also why a Bank of Canada rate cut does not automatically lower fixed rates. The policy rate sets the prime rate that variable mortgages follow, but fixed rates follow bond yields, and a cut the bond market already expects is often priced in before it happens. Bond yields can even move in the opposite direction to the policy rate on the same day, since they respond to inflation expectations and US/global bond markets as much as to the Bank of Canada.
Which Fixed Term Should You Choose?
Fixed mortgage terms run from 1 to 10 years, though most borrowers cluster in the shorter and middle terms. The 5-year fixed remains the most familiar choice; shorter fixed terms have gained ground as borrowers remain reluctant to lock in for longer, and terms beyond five years account for a small share of the market. The table below links to each term, so you can compare the live rate and see which one suits your unique mortgage strategy.
| Fixed Term | Today’s Best Insured Rate | Best For |
|---|---|---|
| 2-year fixed | 4.64% | A short lock when you expect rates to fall soon |
| 3-year fixed | 4.14% | A lower rate with an earlier renewal decision |
| 4-year fixed | 4.29% | A specific four-year plan or horizon |
| 5-year fixed | 4.09% | The balance of rate and certainty that most borrowers want |
| 7-year fixed | 6.19% | Extra certainty with year-5 prepayment protection |
| 10-year fixed | 7.74% | The longest rate lock available at most lenders in Canada |
Fixed vs Variable Rates
A fixed mortgage rate locks your interest rate and payment for the whole term. A variable or adjustable rate moves with your lender’s prime rate, which follows the Bank of Canada’s policy rate. Fixed mortgage rates charge a small premium for certainty; variable trades certainty for the chance to save if rates fall and the risk of paying more if they rise. Variable (VRM) and adjustable (ARM) mortgages have historically proven more cost-effective, but the right choice depends on how much room your budget has to absorb volatility and your comfort with risk, not on a rate forecast.
As of February 2026, variable-rate mortgages were the most popular single choice, accounting for 42% of newly extended mortgages at chartered banks, according to CMHC’s Spring 2026 Residential Mortgage Industry Report, with fixed terms of three to under five years at 35% and the traditional five-year fixed at just 11%. This mix swings with the market, so treat it as a snapshot rather than a rule.
nesto’s own application data leans the same way toward certainty. Variable-rate intent narrows to roughly one-third of applicants by the time they commit, slightly below the 42% share of chartered banks, suggesting nesto borrowers tilt slightly more toward fixed than the broader bank market (nesto application data, April 2026).
Longer Terms and the Year-5 Prepayment Cap
Most fixed terms run five years or less, but nesto also offers 7-year and 10-year fixed terms for borrowers who want a longer lock.
These longer mortgage terms carry a uniquely Canadian protection: under section 10 of the Interest Act, once a term longer than five years has passed its fifth anniversary, the penalty for breaking it is capped at three months’ interest. Before year five, the penalty is the greater of three months’ interest or the interest rate differential (IRD).
Some lenders also charge a reinvestment fee, an administrative charge applied when you pay off your mortgage in full before its maturity date. It usually sits on top of the mortgage discharge fees and prepayment penalty, the greater of the interest rate differential or three months’ interest, and is meant to cover the cost of processing the early payout and reinvesting the capital. Use nesto’s mortgage penalty calculator to estimate your prepayment penalty.
Why Choose nesto for a Fixed Mortgage
Mortgage prepayment penalties are among the top consumer complaints to banking ombudsman offices. Most Big 6 Banks advertise high posted rates and calculate a fixed-rate break penalty from the discount off that posted rate, inflating the interest rate differential. nesto’s posted rates are actual contract rates, so our standard interest-rate differential calculation yields a smaller penalty. The example below compares the prepayment calculation between nesto and a Big 6 Bank, with the illustration showing a chartered bank charging roughly $10,000 more to break the same mortgage.
| Occurrence | Rate | Big Bank | nesto |
|---|---|---|---|
| 3-Month Interest Penalty | Contract Rate | 2.69% | 2.69% |
| Original Term | 5 Years | 5 Years | |
| Posted 5-yr Rate | 4.94% | 2.69% | |
| Implied Discount on Posted Rate | 2.25% | 0% | |
| New Terms on 3 years (Nov 1, 2021) | Remaining Mortgage Balance | $325,000 | $325,000 |
| Years Remaining on Mortgage Term | 3 | 3 | |
| Reference Rate (3-yr Posted) | 3.74% | 2.49% | |
| IRD Calculation | Contract Rate | 2.69% | 2.69% |
| Plus: Discount on Posted (Implied) | 2.25% | 0% | |
| Less: Reference Rate (3-yr Posted) | (3.74%) | (2.49%) | |
| Interest Rate Differential (IRD) | 1.20% | 0.20% | |
| Penalty Charged | IRD Penalty | $11,700 | $1,950 |
| 3-Month Interest Penalty | $975 | $162.50 |
Learn About Fixed Mortgage Rates
Find below the most common questions Canadians ask about fixed mortgage rates.
Why didn’t my fixed rate drop when the Bank of Canada cut the policy rate?
Your fixed rate did not drop because fixed rates follow Government of Canada bond yields, not the Bank of Canada’s policy rate. The policy rate sets the prime rate that lenders use to price variable mortgages, while fixed rates track bond yields, which can rise even on the day the BoC cuts the policy rate. A rate cut the bond market already expects from the BoC is usually priced into bond yields before it happens, so fixed rates may not follow.
Is a fixed or variable mortgage better in Canada?
Neither the fixed nor the variable is better for everyone’s situation. A fixed rate gives payment certainty for the full term, while a variable rate can cost less if rates fall but more if they rise. Historically, variable and adjustable mortgages have been more cost-effective over time on average, but the most suitable choice depends on how much room your budget has to absorb a monthly payment increase and your comfort with risk, rather than on a rate prediction.
Is now a good time to lock in a fixed rate?
It depends on your situation, not on timing the market. Fixed rates follow bond yields, which have been volatile through 2026, so a rate hold can be valuable while you finalize a purchase. The better question is whether the certainty of a fixed payment fits your budget and plans, which a nesto mortgage expert can help you weigh against a variable rate.
How do I get the best fixed mortgage rate?
To get the best fixed rate, compare lenders, choose the term that matches your plans rather than defaulting to five years, and know whether your mortgage is insured, insurable or uninsured, since insured rates are the lowest. Your credit profile and down payment also affect your rate. nesto shows its best rates upfront, and a licensed nesto mortgage expert helps you confirm the rate you qualify for.
Can I break a fixed mortgage early?
Yes, but breaking a fixed mortgage triggers a penalty equal to the greater of three months’ interest or the interest rate differential, which can be large on a fixed term. For terms longer than five years, the penalty is capped at three months’ interest after the fifth anniversary under the Interest Act. Estimate your cost before signing with nesto’s mortgage penalty calculator.
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 salaried employees who provide impartial guidance on mortgage options tailored to your needs and are evaluated based on client satisfaction and the quality of their advice. nesto aims to transform the mortgage industry by providing honest advice and competitive rates through a 100% digital, transparent, and 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.