Current interest rates in Canada are set by financial institutions and influenced by the Bank of Canada's policy decisions. These rates determine the cost of borrowing for mortgages and loans, as well as the return on savings and investments. Understanding the various rates available is essential for Canadians making significant financial decisions, from buying a home to choosing a savings account. This guide provides a factual overview of the key interest rates as they stand today.
The Bank of Canada's Policy Interest Rate
The Bank of Canada's target for the overnight rate is a primary influence on Canada's interest rate environment. This is the interest rate at which major financial institutions borrow and lend one-day funds among themselves. The Bank adjusts this rate to influence inflation and the economy, with changes announced on eight predetermined dates each year. As of September 2026, the policy interest rate is 2.25 percent. This rate directly influences the prime rates set by commercial banks, which in turn affect variable-rate mortgages, lines of credit, and other loans. The Bank also publishes the Canadian Overnight Repo Rate Average (CORRA), which serves as the country's official risk-free rate for financial contracts. Monetary policy decisions are made with the goal of maintaining price stability and supporting maximum sustainable employment. The Bank provides tools to compare changes to the Bank Rate and the overnight rate target over time, allowing for historical analysis of policy shifts.
Current Mortgage Rates from Major Banks
Mortgage rates in Canada are offered as either fixed or variable rates and vary by term length and lender. Fixed rates provide payment stability for the chosen term, while variable rates fluctuate with the lender's prime rate. Major banks like RBC, TD, and Scotiabank publish their posted and special offer rates regularly. For example, RBC lists a 5-year closed variable mortgage at its prime rate plus 0.000 percent, resulting in an Annual Percentage Rate of 4.480 percent. TD advertises a 1-year fixed closed mortgage with a posted rate of 5.69 percent and an APR of 5.789 percent. Lenders often provide the option to lock in a fixed rate for up to 120 days through a pre-approval or rate hold. The Annual Percentage Rate includes the interest cost plus certain applicable fees, providing a more complete picture of the borrowing cost. TD specifies that the APR includes interest and fees such as property valuation fees, but it is not the rate used to calculate regular payments.
Mortgage products come with various terms and conditions. Fixed-rate terms commonly range from 6 months to 10 years, as offered by TD. Variable rates are based on the lender's prime rate, such as the TD Mortgage Prime Rate or the RBC Prime Rate. Open mortgages allow for prepayment without penalty but typically carry higher rates, like TD's 1-year open mortgage at a 9.95 percent posted rate. Closed mortgages have prepayment limits, such as TD's allowance to pay up to 15 percent of the principal annually or 100 percent on an open mortgage without prepayment charges. Special cashback offers or exclusive rates may be available for a limited time, such as TD's cashback offer expiring December 29, 2026. Mortgage protection insurance is an optional product that some lenders offer, like TD Mortgage Protection which can pay off the mortgage balance in the event of death or a covered critical illness. Comparing rates from multiple lenders is a standard practice, and online platforms like Ratehub.ca aggregate offers from Canada's top banks and lenders. It is important for borrowers to review all terms, including prepayment privileges and insurance options, when selecting a mortgage.
Credit Card and Personal Loan Interest Rates
Interest rates on consumer credit products like credit cards and personal loans are typically much higher than secured borrowing rates. Standard purchase interest rates for many credit cards range from 19.99 percent to 20.99 percent. Cash advances on these cards often carry an even higher rate, commonly 22.99 percent. Some cards feature lower promotional or standard rates, such as 12.99 percent for purchases. These rates are not directly tied to the Bank of Canada's policy rate in the same way as variable mortgages but are set by the card issuers based on risk and market competition. Personal lines of credit and unsecured loans generally have lower rates than credit cards but higher rates than mortgages, as they are not secured by real estate. A Home Equity Line of Credit (HELOC), such as the TD Home Equity FlexLine, is secured by real estate and typically offers a lower interest rate compared to unsecured credit products. The HELOC credit limit increases as you repay the borrowed amount, and it is available for use through various convenient options.
Savings and Investment Account Rates
Financial institutions offer a range of interest rates on savings vehicles, which are influenced by the broader interest rate environment. Savings accounts, including Tax-Free Savings Accounts and U.S. dollar accounts, earn interest at rates set by the bank. Guaranteed Investment Certificates provide a fixed rate of return for a locked-in term, with rates varying by term length and issuer. Scotiabank, for instance, lists its prime lending rate and details rates for GICs, savings accounts, and mutual funds on its interest rates page. The return on these products is typically lower than the cost of borrowing, reflecting the risk-free or low-risk nature of the investment. Investors should review the specific rates, terms, and any associated fees for each product. Scotiabank offers 58 different mutual funds, including balanced, equity, index, and cash equivalent funds. The bank also provides registered plans like RRSPs, RESPs, and RDSPs to suit different life stage needs. Fees can apply to these accounts, such as a potential $20 service charge for closing a Scotiabank account within 90 days of opening it.
Key Factors Influencing Interest Rate Changes
Several economic indicators and policy decisions drive changes in the interest rates Canadians encounter. The Bank of Canada's primary tool is adjusting the target for the overnight rate to keep inflation within a target range. Financial institutions then adjust their prime lending rates, which are the basis for variable-rate products. Yield curves for Government of Canada bonds, which show yields on zero-coupon bonds across different maturities, influence long-term fixed mortgage rates. Conditions in the money market, where short-term capital is traded using instruments like treasury bills and commercial paper, also affect rates. Internationally, rates can be influenced by actions of other central banks, such as the U.S. Federal Funds Rate and the U.S. Prime Rate. Lenders also set rates based on their own cost of funds, competitive positioning, and the perceived risk of the loan. The Bank of Canada states that its overnight interest rate can affect the housing market, home prices, and the cost of mortgages.
Comparing Current Mortgage Rate Offers
Major Canadian banks and brokers advertise a wide range of mortgage rates. RBC lists a posted variable rate for a 5 Year Closed mortgage at RBC Prime Rate plus 0.000 percent with an APR of 4.480 percent. TD Canada Trust advertises a 1 Year Fixed Closed mortgage with a posted rate of 5.69 percent and an APR of 5.789 percent. Ratehub.ca provides exclusive rates from various lenders, such as a 5 year fixed rate of 4.34 percent. These advertised rates are categorized by term, type, and special promotional offers.
| Lender/Provider | Product | Rate Type | Notable Condition/Offer |
|---|---|---|---|
| RBC | 5 Year Closed Variable | Prime + 0.000% (4.480% APR) | Based on RBC Prime Rate |
| TD Canada Trust | 1 Year Fixed Closed | 5.69% Posted Rate (5.789% APR) | Competitive rate |
| Ratehub.ca Exclusive | 5 Year Fixed | 4.34% | Available through broker |
| Ratehub.ca Exclusive | 5 Year Variable | 3.43% | Available through broker |
| TD Canada Trust | 1 Year Open Mortgage | 9.95% Posted Rate (10.049% APR) | Higher rate for open flexibility |
| Scotiabank | Various Mortgages | Disclosed on their site | Linked to Scotiabank Prime |
| RBC | 5 Year Open Variable | Prime + 3.300% (7.780% APR) | Open term with higher rate |
| TD Canada Trust | 2 Year Fixed Closed | Posted rate listed | Part of their competitive rates |
These advertised rates are subject to change and individual borrower qualification. Special offers, such as TD's cashback offer expiring December 29, 2026, or RBC's offer available until October 31, 2026, may apply. The APR includes interest and certain fees, providing a more accurate cost comparison than the posted rate alone. Borrowers should use these figures as a starting point for their own research and discussions with lenders or mortgage professionals. Ratehub.ca, which has been named Canada's Brokerage of the Year from 2018 to 2021, allows users to see personalized rates from top banks and lenders after detailing their mortgage needs.
Common Mistakes When Evaluating Interest Rates
When assessing interest rates, Canadians can overlook important details that affect the total cost and flexibility of a financial product. One common error is focusing solely on the posted interest rate without considering the Annual Percentage Rate, which includes additional fees. Another is not understanding the difference between a lender's posted rate and the actual special offer or discounted rate for which they may qualify. For mortgages, some borrowers neglect to inquire about prepayment privileges, which allow extra payments on closed mortgages or full repayment on open ones, or the specifics of a rate hold. Assuming that a variable rate will always be lower than a fixed rate over a term can be a miscalculation, as variable rates change with the prime rate. Finally, not comparing rates across multiple lenders, including banks, credit unions, and mortgage brokers, may result in missing a more favourable offer. Borrowers might also forget to check if rates are held for a specific period, which is typically 120 days for fixed rates at institutions like TD and RBC. Another oversight is not reviewing all associated account fees for savings or chequing products, such as monthly account fees, Interac e-Transfer fees, or wire transfer charges, which can affect the net return or cost.
Tools and Resources for Rate Research
Canadians have access to several tools and resources to research and compare current interest rates. The Bank of Canada website provides data on the overnight rate, CORRA, and yield curves for zero-coupon bonds, available for download. Individual bank websites, such as those for RBC, TD, and Scotiabank, publish their latest rates on prime lending, mortgages, credit cards, loans, and savings. Online mortgage brokerages and comparison platforms like Ratehub.ca allow users to compare mortgage rates from multiple lenders and access mortgage calculators for payments, affordability, and land transfer tax. These platforms often provide educational articles on topics like fixed versus variable rates and mortgage renewal. Ratehub.ca also offers a full mortgage brokerage service, guiding clients from online application to closing. Financial institutions provide their own calculators to estimate mortgage payments and home affordability, and they offer the option to connect with mortgage specialists for personalized advice. It is important to use a modern web browser with JavaScript enabled to view the interactive charts and data provided by the Bank of Canada and other financial sites. Ratehub.ca features calculators to see payments on weekly, bi-weekly, or monthly schedules and to determine CMHC insurance costs based on down payment percentage.
Frequently asked questions
What is the current Bank of Canada interest rate?
As of September 2026, the Bank of Canada's target for the overnight rate is 2.25 percent. This policy rate is set by the Bank's Governing Council and is reviewed on eight scheduled announcement dates each year. Changes to this rate influence the prime rates set by commercial banks, which affect variable-rate mortgages and other loans. The Bank also publishes the Canadian Overnight Repo Rate Average (CORRA) as the country's risk-free rate.
What is a good mortgage rate in Canada right now?
Mortgage rates vary by product, term, and lender. As of current data, examples of advertised rates include a 5-year fixed rate at 4.34 percent through a broker and a 5-year closed variable rate at 4.480 percent APR from RBC. A 'good' rate depends on whether you choose fixed or variable, your financial profile, and the specific terms of the mortgage offer. Comparing offers from multiple lenders and brokers is the best way to find a competitive rate.
What is the difference between a fixed and variable mortgage rate?
A fixed mortgage rate remains unchanged for the entire term of the mortgage, providing payment stability. A variable mortgage rate is based on the lender's prime rate, which can increase or decrease during the term, causing the portion of your payment going toward interest to fluctuate. Your payment amount on a variable rate mortgage may stay the same, but the allocation between principal and interest changes. With a fixed rate, your principal and interest payments stay exactly the same during the term.
How long can I lock in a mortgage rate?
Many lenders offer a mortgage rate hold, typically for up to 120 days. This means that if you obtain a pre-approval or commit to a specific mortgage product, the agreed-upon fixed interest rate is guaranteed for that period, even if general rates rise. This hold generally applies only to fixed-rate mortgages, as variable rates can change. For example, TD offers a 120-day rate hold with a mortgage pre-approval.
What are current credit card interest rates?
Standard purchase interest rates for many credit cards in Canada range from 19.99 percent to 20.99 percent. Cash advances on these cards often have a higher rate, commonly 22.99 percent. Some cards offer lower rates, such as 12.99 percent for purchases. These rates are set by the card issuer and are detailed in the cardholder agreement. Scotiabank, for example, lists credit card rates on its interest rates page.
Where can I compare current interest rates?
Canadians can compare interest rates by visiting individual bank websites, such as those of RBC, TD, and Scotiabank, which publish their rates. Online financial comparison platforms like Ratehub.ca aggregate and compare mortgage rates from multiple lenders and brokers. These tools allow for side-by-side comparisons of rates, terms, and features. The Bank of Canada website also provides tools to compare changes to interest rates over time.
Sources and further reading
- Current Mortgage Rates | RBC Royal Bank of Canada rbcroyalbank.com
- Mortgages Rates, TD Canada Trust td.com
- Interest rates bankofcanada.ca
- Compare best mortgage rates in Canada today ratehub.ca
- Scotiabank Interest Rates scotiabank.com
This article explains how things work and is not financial, tax or legal advice. Rules, limits and rates change, so check the current figures with the Canada Revenue Agency, your province or your financial institution before you act.