Variable or Fixed? What Type of Mortgage is Best For Me?

How Are Mortgage Rates in Canada Determined?
Weekly Q&A with Mark Chala


fixed or variable mortgage rates

The most important aspect of choosing the mortgage type that best suits you is to understand that it’s always based on individual circumstance. That’s why both types of mortgages still exist – some people are better suited with variable mortgages and some are better off with a fixed rate.

Both have their advantages. Fixed rates offer stability in your monthly payments. Variable mortgages are a bit riskier, but you’re often better off in terms of monthly payments because the rate is usually lower.

Usually. It’s not a guarantee, but as we talked about last week, when the Bank of Canada determines variable rates, the number moves in accordance with the Bank’s key interest rate.


So, what’s best for you?

Well, the first step is to calculate how much you can afford on a monthly basis. You don’t want to be house-poor in the event your rate increases. Is the risk worth the reward?

Are you alright with an increase within your parameters? Or would you be more comfortable knowing how much you’ll be spending throughout the term of your mortgage?

This is the most basic way of starting the conversation about which type of mortgage works best for you.

More questions? I’d love to help get you on the right track.