Fixed Rate vs Variable Rate Mortgages: Finding the Best Fit for Your Situation

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One of the first decisions homebuyers face, from first-time homebuyers to those looking to renew their mortgage, is whether to select a fixed or variable rate mortgage. Deciding the best fit for you will depend on your unique situation. To help you make the best choice, we broke down the key differences below.

Fixed and Variable Mortgage Comparison

To lock in your rate or not is always the question. Here are some key differences to make the answer easier:

Fixed Rate
Variable Rate
Interest Rate
  • Rates remain the same throughout

    your mortgage term

  • May have higher rates than variable
  • Can change at any time
  • Often a lower rate than fixed
  • Payments
    Payments remain the same for the termPayments remain the same for the term so long as you do not reach the trigger rate*
    Pre-Payment Penalties
  • Tends to have a higher pre-

    payment penalty

  • Penalty is greater of interest

    differential or 3-month interest if you pay off mortgage before end of term

  • Tends to have a lower pre-payment


  • There is a 3-month interest penalty

    if you pay off your mortgage before end of term

  • Pre-Payment Privileges
    Can make additional payments up to 20% of original mortgage balance annually Can make additional payments up to 20% of original mortgage balance annually

    * The trigger rate is the point at which the interest rate on your mortgage has increased to the point where your fixed monthly payment is only covering interest and not any of the mortgage’s principal balance. 

    Finding Your Mortgage Match

    Finding your perfect Mortgage Match depends on your goals and financial circumstances. An excellent place to start is by taking our Mortgage Match Quiz to get mortgage recommendations based on the answers to your current situation and what you are looking for in a home. You can also speak to one of our Mortgage Specialists, who will help you determine the best mortgage fit. 

    Take the Mortgage Match Quiz

    “Our team can walk you through your options and help you find the mortgage solutions that meet your needs,” says Westoba’s Mobile Mortgage Specialist in Winnipeg. “I believe the mortgage process should be as easy as possible; that’s why we’re happy to meet you whenever and wherever works best for you.”

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