What are the best mortgage rates in Canada right now?
As of September 25, 2026, the publicly advertised lowest mortgage rates in Canada show a notable spread between fixed and variable options. According to Ratehub.ca, the lowest 5-year fixed mortgage rate rose to 4.24% last week, while the lowest 5-year variable rate held steady at 3.40%.
This spread reflects broader market dynamics. Fixed mortgage rates are priced primarily from Government of Canada bond yields — not the Bank of Canada's overnight rate — and bond yields have been under pressure from inflation concerns, ongoing trade uncertainty, and the Federal Reserve's recent 25-basis-point rate hike keeping global bond markets volatile.
Importantly, some shorter-term fixed rates remain below the 4% threshold: 2-year fixed rates start around 3.89% and 3-year fixed rates around 3.94% (Ratehub). Borrowers willing to renew sooner may find these terms attractive if they expect rates to decline in the coming years.
Current rate comparison — best rates available
| Product | Ratehub (Sept 25, 2026) | WOWA (Sept 25, 2026) | Note |
|---|---|---|---|
| Best 5-year fixed (uninsured) | 4.24% | ~4.29%+ | Conventional rate |
| Best 5-year variable (insured) | 3.40% | 3.30% | Prime-linked rate |
| Best 3-year fixed | 3.94% | — | Shorter-term option |
| Best 2-year fixed | 3.89% | — | Shortest available term |
| Major-bank prime | ~4.45% | ~4.45% | BoC 2.25% + spread |
These figures are publicly displayed market snapshots and may use different assumptions across lenders. They are not personalized offers. Your actual rate depends on your down payment amount, credit profile, property details, mortgage insurance status, and the specific lender or broker you choose. Compare multiple offers before committing.
Why is the fixed vs variable gap so wide?
The 84-basis-point spread between the lowest 5-year fixed (4.24%) and 5-year variable (3.40%) is unusually wide and reflects two key forces:
- Bond yields. Fixed rates are priced from Government of Canada bond yields, which have been elevated due to inflation concerns tied to higher energy prices, trade tariff uncertainty, and the Fed's recent 25-bps rate hike keeping global bond markets volatile. The 5-year Government of Canada yield has remained at elevated levels, keeping fixed-rate renewals and new purchases more expensive.
- Policy rate stability. The Bank of Canada has held its target overnight rate at 2.25% since September 2, 2026 — its eighth consecutive hold. Because variable-rate mortgages are tied directly to lender prime (which follows the overnight rate), variable rates have stayed stable around 3.40%. The next Bank of Canada decision is October 28, 2026.
The Bank of Canada's September 2 announcement reflected the Bank's difficult position balancing renewed inflationary pressures against the risk that a prolonged trade war could weaken economic growth, employment, and consumer spending.
How the Bank of Canada September 2 hold affects your options
The September 2, 2026 decision to hold the policy rate at 2.25% means no change to variable-rate mortgages — lender prime stays at approximately 4.45%, so variable-rate payments and interest costs remain unchanged.
For fixed-rate borrowers, the picture is more complex. Fixed rates are influenced by bond yields rather than the overnight rate, and could remain volatile in coming weeks. A prolonged trade conflict that weakens economic growth could push bond yields and fixed rates lower, while higher energy prices and tariff-driven inflation could put upward pressure on them.
If the Bank of Canada cuts on October 28, variable-rate mortgages would likely follow prime down. Fixed-rate borrowers would not see an immediate benefit unless bond yields also fall.
What the Canada housing market looks like in September 2026
Canada's housing market showed a quiet start to 2026, with buyers staying on the sidelines amid elevated rates and trade uncertainty. Both fixed and variable mortgage rates remain historically elevated compared to the 2021 lows. According to Ratehub's market update, concerns around employment, household income, and mortgage rates may cause both buyers and sellers to take a wait-and-see approach, potentially slowing sales activity.
The CMHC Spring 2026 Residential Mortgage Industry Report confirms continued renewal-wave pressure, with borrowers renewing after 5-year terms facing significant interest-rate shocks compared to ultra-low 2021 rates.
How to compare rates before you commit
When comparing mortgage rates, keep these factors in mind:
- Insurance status. Insured (high-ratio) rates are typically lower than uninsured (conventional) rates because default insurance protects the lender. If your down payment is under 20%, you'll need mortgage default insurance.
- Term length. Shorter terms (2-3 years) offer lower rates now but mean renewing sooner. Longer terms (5 years) provide payment stability but may lock you in if rates fall.
- Lender comparison. Major banks, credit unions, and monoline lenders may offer different rates. Online brokers and comparison platforms can help you see multiple offers.
- Prepayment privileges. Check lump-sum payment limits, portability features, and prepayment penalties before choosing a lender.
Rates shown here are publicly displayed market snapshots and may change without notice. They are not personalized offers. Your actual rate depends on your credit profile, income, property details, and mortgage insurance status.
Want to see what rate you might qualify for? Use the mortgage payment calculator to estimate your payments, then compare offers from multiple lenders. RateShop can help you compare current rates side by side.
Compare Current RatesFAQ: Best Mortgage Rates Canada September 2026
What are the current best mortgage rates in Canada?
As of September 25, 2026, the lowest 5-year fixed rate is approximately 4.24% and the lowest 5-year variable rate is approximately 3.40%. Shorter-term rates include 2-year fixed at ~3.89% and 3-year fixed at ~3.94%. These are publicly displayed market snapshots and may vary by borrower profile.
Why is the gap between fixed and variable rates so wide?
The 84-basis-point spread reflects elevated bond yields driving fixed rates higher, while the Bank of Canada's 2.25% hold keeps variable rates stable. Bond yields are influenced by inflation concerns, trade uncertainty, and global rate movements. This spread may narrow if bond yields fall or widen further if inflation pressures persist.
Will mortgage rates go down before the October 28 Bank of Canada decision?
No one can predict rate movements with certainty. If the Bank cuts on October 28, variable rates would likely follow prime down. Fixed rates are driven by bond yields and may not move in the same direction. Economic data on inflation, employment, and trade policy will continue to shape the outlook.
Are there mortgage rates below 4% available?
Yes, shorter-term fixed rates remain below 4%: 2-year fixed at approximately 3.89% and 3-year fixed at approximately 3.94%. The lowest 5-year fixed is around 4.24%. Availability depends on the lender, insurance status, and borrower qualifications.