Ontario Mortgage Rates
Compare mortgage rates from the top banks, brokers, and credit unions in Ontario.
The Best Canadian Mortgage Rates in Ontario
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About Ontario
More About: Living In Ontario
Ontario is Canada's second largest province (it's over 4 times the size of the UK and almost 1/3 the size of India) and also the most populous province, with over 14 million residents. Here are some more fast facts about Ontario:
- Ontario has more than 250,000 lakes, which contain about a third of the world's fresh water
- Ontario offers everything from wilderness expeditions to urban excursions – the landscape is vast and varied (and so are the people!)
- Ontario's thriving economy is supported by a variety of industries and generates approximately 37% of the national GDP
- The capital city of Ontario is Toronto, Canada's largest city. Toronto has the largest variety of theatres and performing arts companies in Ontario, and the second largest in North America (second only to New York)
- The average home price in Ontario is about $596,000 – that's almost $200,000 more than the national average
- The Toronto/GTA housing market, with its soaring home prices, have skewed the provincial numbers. There are many other cities and towns in Ontario offering more affordable housing
FAQ: Everyone knows Toronto is the most expensive city in Ontario, but what is the cheapest?
Windsor is arguably the cheapest city to live in Ontario. Located just across the border from Detroit, MI, Windsor has many waterfront properties valued at just a fraction of the price of a Toronto home. Despite increases in recent years, the average price of a single-family home is still less than the national average.
Ontario Housing Statistics
Ontario is Canada's most populous, prosperous province and prices are reflected as such. However, with such a vast range of cities and landscapes, housing costs also vary largely within the province.
| Property Prices: High | Quality of Life Index: High |
| Cost of Living: High | Traffic Index: High |
Your Top Mortgage Questions Answered
Whether you’re a First Time Home Buyer or buying your second, third or fourth home, it pays to compare mortgage rates with Ratesupermarket.ca.
What can I afford?
Before you start looking for a dream home, it’s a good idea to figure out how much you can afford, which is why we recommend using the RateSupermarket.ca Affordability Calculator.
Once you know how much you can afford, you’ll know how much of a down payment you’ll need. Saving for a down payment is an important part of the home buying process. Furthermore, the size of your down payment can impact how much of a mortgage you qualify for. In Canada, the minimum down payment is 5% on the first $500,000 of the home price, and 10% on any portion exceeding $500,000, up to $1 million. A home priced above $1 million requires a minimum of 20% down.
One caveat that buyers need to be aware of is when they put down less than 20% of the cost of their home, they have to buy mortgage default insurance. If you’re able to put more than 20% of the home purchase down, you will qualify for a conventional mortgage product from your lender. If not, expect to pay an additional premium from 0.50 – 2.75% of the mortgage value, depending on your Loan to Value ratio (LTV) and amortization period.
Part of affordability that doesn’t automatically come to mind when you start looking for a home is the additional costs that come after your offer has been accepted. From closing costs and property taxes to life costs, it can really add up!
Should I work with a bank or a mortgage broker?
Prospective home buyers can turn to their bank or a mortgage broker for their mortgage needs, but many people are not sure what would be best for their needs.
By going to the bank, home buyers are going directly to a lender and behind the wheel when it comes to negotiations. If you decide to work with your bank, you are able to consolidate all your services with a provider you’ve worked with and trust, plus you may be eligible for discounts.
A broker on the other hand, provides home buyers the advantage of having access to a number of rates offered by multiple lenders, and they do the legwork and negotiating for you to get the best available rate and terms.
Brokers don’t always offer the same rates or products as the banks, which is why we provide comprehensive mortgage rate market comparison in Canada, comparing different brokers as well as banks, credit unions, and other lenders for you.
Should I choose a Fixed or Variable Rate Mortgage?
While you’re shopping for your dream home, you’ll have to consider if you want a fixed or variable rate mortgage.
A fixed mortgage rate enables you to “lock in” a predetermined rate for a term (set period of time). The most popular term is 5 years, though you can get one that can last anywhere from 6 months to 25 years.
The Pros of a Fixed Mortgage Rate:
- Security and comfort knowing what your principal and interest will be during the duration of your chosen term
- Financial planning and budgeting is easier
- Lower risk tolerance; a variable mortgage rate can be more volatile
The Cons of a Fixed Mortgage Rate:
- Pay more for securing and locking in a rate
- Pay more for breaking a contract Could cost more over long term
A variable mortgage rate is based on the mortgage lender’s prime rate. Prime is determined by current economic conditions, and is the benchmark interest rate used by major banks when pricing for short term loans. Since prime can increase or decrease on a monthly basis, a variable mortgage rate would increase or decrease with it as well.
The Pros of a Variable Mortgage Rate:
- Lower monthly payments as long as prime doesn’t increase rate above fixed mortgage rate
- Pay three months’ interest for breaking a contract
The Cons of a Variable Mortgage Rate:
- Less financial security as prime can increase, increasing your monthly interest
- Financial planning and budgeting is harder
What can I afford?
Before you start looking for a dream home, it’s a good idea to figure out how much you can afford, which is why we recommend using the RateSupermarket.ca Affordability Calculator.
Once you know how much you can afford, you’ll know how much of a down payment you’ll need. Saving for a down payment is an important part of the home buying process. Furthermore, the size of your down payment can impact how much of a mortgage you qualify for. In Canada, the minimum down payment is 5% on the first $500,000 of the home price, and 10% on any portion exceeding $500,000, up to $1 million. A home priced above $1 million requires a minimum of 20% down.
One caveat that buyers need to be aware of is when they put down less than 20% of the cost of their home, they have to buy mortgage default insurance. If you’re able to put more than 20% of the home purchase down, you will qualify for a conventional mortgage product from your lender. If not, expect to pay an additional premium from 0.50 – 2.75% of the mortgage value, depending on your Loan to Value ratio (LTV) and amortization period.
Part of affordability that doesn’t automatically come to mind when you start looking for a home is the additional costs that come after your offer has been accepted. From closing costs and property taxes to life costs, it can really add up!
Should I work with a bank or a mortgage broker?
Prospective home buyers can turn to their bank or a mortgage broker for their mortgage needs, but many people are not sure what would be best for their needs.
By going to the bank, home buyers are going directly to a lender and behind the wheel when it comes to negotiations. If you decide to work with your bank, you are able to consolidate all your services with a provider you’ve worked with and trust, plus you may be eligible for discounts.
A broker on the other hand, provides home buyers the advantage of having access to a number of rates offered by multiple lenders, and they do the legwork and negotiating for you to get the best available rate and terms.
Brokers don’t always offer the same rates or products as the banks, which is why we provide comprehensive mortgage rate market comparison in Canada, comparing different brokers as well as banks, credit unions, and other lenders for you.
Should I choose a Fixed or Variable Rate Mortgage?
While you’re shopping for your dream home, you’ll have to consider if you want a fixed or variable rate mortgage.
A fixed mortgage rate enables you to “lock in” a predetermined rate for a term (set period of time). The most popular term is 5 years, though you can get one that can last anywhere from 6 months to 25 years.
The Pros of a Fixed Mortgage Rate:
- Security and comfort knowing what your principal and interest will be during the duration of your chosen term
- Financial planning and budgeting is easier
- Lower risk tolerance; a variable mortgage rate can be more volatile
The Cons of a Fixed Mortgage Rate:
- Pay more for securing and locking in a rate
- Pay more for breaking a contract Could cost more over long term
A variable mortgage rate is based on the mortgage lender’s prime rate. Prime is determined by current economic conditions, and is the benchmark interest rate used by major banks when pricing for short term loans. Since prime can increase or decrease on a monthly basis, a variable mortgage rate would increase or decrease with it as well.
The Pros of a Variable Mortgage Rate:
- Lower monthly payments as long as prime doesn’t increase rate above fixed mortgage rate
- Pay three months’ interest for breaking a contract
The Cons of a Variable Mortgage Rate:
- Less financial security as prime can increase, increasing your monthly interest
- Financial planning and budgeting is harder
What is the difference between a mortgage term and an amortization period?
Amortization period refers to the entire length of your mortgage, whether it’s a short or long term mortgage. Most mortgages are negotiated over a 25 year amortization period.
During those 25 years, there will be a series of negotiated terms for a set number of years. The most common mortgage term length is five years, which means you pay the principal and interest at an agreed rate for five years, then negotiate another five-year term.
Does my credit score have an effect on getting preapproved for a mortgage?
Is your credit score mortgage ready? Your credit score is important because it’s the deciding factor on if you get preapproved and how much you get preapproved for. Lenders want to know that you will repay your debt, so they consider the following factors: payment history, outstanding debt, credit history age, applying for new credit too often and the type of debt you are looking for (long term debt vs. short term debt).
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