5-Year Variable Mortgage Rates

How to compare variable mortgage terms in Canada

Variable mortgage terms let you borrow with a rate that can move when lender prime rates change. The term length affects how long your variable-rate agreement lasts, how soon you can renew, and how much flexibility you may have if your plans or the rate market changes.

What changes when you choose a different variable term?

The term can affect your lender options, rate discount, payment rules, prepayment flexibility, conversion options, and renewal timing. A lower variable rate can be useful, but borrowers should also compare how the mortgage handles payment changes, trigger-rate risk, and early exit penalties.

Who may prefer shorter variable mortgage terms?

Shorter variable terms may suit borrowers who want flexibility, may sell or refinance sooner, or want to reassess their mortgage as market rates change. They can also be useful for borrowers who do not want to commit to a longer variable-rate term.

Who may prefer longer variable mortgage terms?

Longer variable terms may suit borrowers who are comfortable with rate movement and want to keep a variable structure for a longer period. Before choosing a longer variable term, compare the rate discount, payment adjustment rules, conversion options, and penalties if you need to break the mortgage early.