What is happening with mortgage renewal rates before the October 2026 BoC decision
The Bank of Canada held its target overnight rate at 2.25% on September 2, 2026, marking its seventh consecutive rate hold. The Bank Rate sits at 2.50% and the deposit rate at 2.20%. With the next scheduled decision on October 28, 2026, borrowers approaching renewal are weighing whether to lock in today's rates or wait for a possible policy shift.
Canada's economy has shown signs of strengthening in 2026. GDP grew 3.3% in the second quarter following a weak first quarter, consumption showed solid gains, and housing activity rebounded after several weak quarters. The unemployment rate edged down to 6.4% in July 2026, though demand for labour remains subdued and excess supply persists in the economy. CPI inflation has been hovering around 3%, mainly due to persistently higher gasoline prices, while core inflation remained close to 2% in July. The Bank noted that upside risks to its inflation forecast have increased due to the ongoing Middle East conflict and elevated oil prices, and new US tariffs and Canadian counter-tariffs could also raise costs for businesses over time.
These conditions matter for renewal borrowers because they shape where rates go next. The Bank's September 2026 Monetary Policy Report projected growth expected to pick up and inflation easing to around 2% over the projection horizon. However, the elevated uncertainty — from geopolitical tensions, oil prices, and trade policy — means the path is far from certain.
How fixed and variable renewal rates are moving heading into October 2026
Fixed mortgage renewal rates are priced mainly off Government of Canada bond yields. The 5-year GoC bond yield was approximately 3.40% in mid-September 2026, up from around 3.25% in late August. When bond yields rise, 5-year fixed renewal rates tend to rise with them — which is what has been happening in September. The lowest insured 5-year fixed renewal rate remains near 3.94% (WOWA), while the best high-ratio 5-year fixed is around 4.09-4.24% (Ratehub). Conventional (uninsured) 5-year fixed rates are slightly higher, near 4.04% (WOWA).
Variable-rate renewal mortgages, by contrast, are tied directly to the Bank of Canada's overnight rate through the prime rate, which major banks are offering at approximately 4.45%. Since the BoC has held at 2.25%, variable renewal rates have been stable. The lowest insured 5-year variable is around 3.25-3.30% (WOWA/Ratehub). This means variable-rate renewals are currently cheaper on paper but carry the risk of payment increases if the BoC raises rates at or after the October 28 decision.
5-year fixed vs 5-year variable for renewals in September 2026
| Factor | 5-year fixed renewal | 5-year variable renewal |
|---|---|---|
| Lowest insured snapshot (Sept 2026) | ~3.94% (WOWA) / ~4.09-4.24% best high-ratio (Ratehub) | ~3.25-3.30% (WOWA/Ratehub) |
| Starting rate | Higher | Lower |
| Payment certainty | Fixed for 5 years | Can change if prime moves |
| Main driver | 5-year GoC bond yields (~3.40%) | Bank of Canada policy rate / prime (~4.45%) |
| Best fit | Want maximum payment certainty | Can absorb movement; expect BoC cut |
| Key risk | Locked in if fixed pricing falls | Prime rises and cost increases |
| Spread | Approximately 70-95 basis points between fixed and variable | |
These are public comparison snapshots from September 2026, not approvals. Your actual renewal rate depends on your insurer category (insured, insurable or uninsured), remaining amortization, equity, property use, credit and documentation. Compare your specific scenario rather than the advertised headline.
What to weigh: lock in now or wait for the October 28 Bank of Canada decision
- Check today's Canadian mortgage rates across terms and rate types. The spread between fixed and variable is roughly 70-95 basis points in September 2026.
- Use a mortgage payment calculator to model your renewal payment at current fixed and variable rates, and see what a 0.25-0.50% increase or decrease would do to your monthly budget.
- Review your lender's renewal offer carefully. Many borrowers automatically accept their lender's renewal rate without shopping around. Compare it against current market rates from public comparison sites.
- Consider the direction of bond yields. The 5-year GoC bond yield rose from ~3.25% in late August to ~3.40% in mid-September 2026, suggesting fixed-rate pricing may face upward pressure before the October 28 decision.
- Think about your risk tolerance. If a payment increase would strain your budget, locking in a fixed rate now provides certainty regardless of what the BoC does. If you can absorb movement and believe rates may fall, a variable renewal could save money.
- Review mortgage renewal rates broadly, since the 2025-2026 renewal wave means many Canadians are renewing at higher rates than their original terms.
- Do not try to perfectly time the market. The BoC's October 28 decision is one input among many. Focus on a payment you can sustain for the next five years.
Compare renewal rates before the October 2026 BoC decision
RateShop can help you review current fixed and variable renewal options side by side and estimate your monthly payment under different scenarios — without treating any public rate as a guaranteed approval. Start a no-obligation rate check before the October 28 decision.
Start a rate checkRate disclaimer
Rates, payments and market commentary on this page are for general education only and may change without notice. Actual mortgage renewal rates depend on lender criteria, borrower qualifications, property details, mortgage purpose, remaining amortization, insurance status and documentation. As of September 25, 2026, the Bank of Canada held its policy rate at 2.25% (September 2, 2026), with its next scheduled decision on October 28, 2026; outcomes are uncertain. Public comparison figures (WOWA lowest insured 5-year fixed ~3.94%, conventional ~4.04%; Ratehub best high-ratio 5-year fixed ~4.09-4.24% and 5-year variable ~3.25-3.30%; 5-year GoC bond yield ~3.40%; major-bank prime ~4.45%) are snapshots as of late September 2026, not approvals or rate guarantees. This page does not provide personalized mortgage, legal, tax or financial advice and does not guarantee approval or a specific rate.
Frequently asked questions
What are current mortgage renewal rates in Canada before the October 2026 Bank of Canada decision?
As of September 25, 2026, public comparison data shows the lowest insured 5-year fixed mortgage renewal rate at about 3.94% (WOWA) and the best high-ratio 5-year fixed at about 4.09-4.24% (Ratehub). The lowest conventional (uninsured) 5-year fixed is near 4.04% (WOWA), and the 5-year variable starts around 3.25-3.30%. The Bank of Canada has held its policy rate at 2.25% since September 2, 2026, with the next decision scheduled for October 28, 2026. These are public comparison snapshots, not approvals.
Should I lock in my mortgage renewal rate before the October 28 Bank of Canada decision?
Whether to lock in depends on your risk tolerance and the current rate environment. Bond yields have been trending up in September 2026, pushing fixed rates higher. If you value payment certainty and can afford today's rates, locking in protects you against further increases. If you believe the BoC may cut at or after the October 28 meeting, waiting could save money. This is educational information, not personalized advice. Use a mortgage payment calculator to model both scenarios.
How does the Bank of Canada's October 2026 decision affect mortgage renewal rates?
A Bank of Canada decision affects variable-rate mortgages directly through the prime rate, and fixed-rate mortgages indirectly through Government of Canada bond yields. The BoC held at 2.25% on September 2, 2026, its seventh consecutive hold. The next decision is October 28, 2026. A cut would generally lower variable rates and could pressure fixed rates down over time; a hold or increase would tend to keep rates flat or higher. Bond yields have been rising in September 2026, suggesting fixed-rate pricing may face upward pressure.
What is the current 5-year fixed vs variable spread for mortgage renewals?
In late-September 2026 snapshots, the spread between 5-year fixed and 5-year variable rates is roughly 70-95 basis points. The lowest insured 5-year fixed is about 3.94% (WOWA) while the 5-year variable starts around 3.25-3.30%. The gap means variable mortgages are cheaper upfront but carry the risk of payment increases if the prime rate rises. Fixed mortgages give five years of payment certainty.
What should renewing borrowers compare before signing a renewal offer?
Compare your lender's renewal offer against current market rates from public comparison sites. Check whether the renewal rate is insured or uninsured, the prepayment privileges, portability, and the break penalty. Review the amortization period and use a mortgage payment calculator to estimate your monthly cost. Also consider whether the Bank of Canada's October 28 decision could move rates in your favour. Review current Canadian mortgage rates and renewal rates before signing.
Sources used
- Bank of Canada: Bank of Canada maintains the policy rate at 2¼% (September 2, 2026 press release — GDP 3.3%, unemployment 6.4%, CPI ~3%, core ~2%, Middle East risk)
- Bank of Canada: Policy interest rate (2.25% held; next decision October 28, 2026)
- Bank of Canada: Selected benchmark bond yields (5-year GoC yield approximately 3.40%, mid-September 2026)
- Ratehub.ca: Best mortgage rates in Canada (September 2026: 5-yr fixed ~4.09-4.24%, 5-yr variable ~3.30%, prime ~4.45%)
- WOWA.ca: Lowest mortgage rates in Canada (September 2026: 5-yr fixed ~3.94% insured, ~4.04% conventional, 5-yr variable ~3.25-3.30%)
- Bank of Canada: How will mortgage payments change at renewal? (staff analytical note 2025-21)
- CMHC: Residential Mortgage Industry Report, Spring 2026 (renewal-wave outlook)
- Financial Post: Budget watchdog predicts Bank of Canada will hike interest rate to 2.75% in 2027