Frank Rendon

A fixed rate locks you in for a term, allowing you to know your monthly mortgage payment and have it stay the same. While variable rates are often lower than a fixed rate, they can fluctuate with the BoC posted rate. This allows you to benefit from interest rate drops, but you pay more when the interest rate rises.

The qualifying rate is the Bank of Canada conventional 5 year fixed posted rate. A contract rate is the rate offered by the lender on the homebuyer’s actual mortgage payment.