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Best 5-Year Variable Mortgage Rates

Last Updated: 14 Aug, 2018
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Rate
2.65%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.65% 5 Year, Variable
monthly
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Rate
2.65%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.65% 5 Year, Variable
monthly
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Rate
2.65%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.65% 5 Year, Variable
monthly
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Rate
2.65%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.65% 5 Year, Variable
monthly
Get Rate
Rate
2.65%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.65% 5 Year, Variable
monthly
Get Rate
Rate
2.65%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.65% 5 Year, Variable
monthly
Get Rate
Rate
2.66%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.66% 5 Year, Variable
monthly
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Rate
2.66%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.66% 5 Year, Variable
monthly
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Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insured 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
Rate
2.70%
Terms
5 Year, Variable
Amortization
Insurable 25 years
Monthly Payment
2.70% 5 Year, Variable
monthly
Get Rate
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What is a 5-year variable rate?

The term “5-year variable rate” is made up of two parts: the length of time and the type of mortgage.


The length of term is how long you agree to a certain set of conditions for your mortgage, and the type of mortgage dictates the interest rate you’ll pay. A variable rate mortgage means that the interest rate can change throughout the duration of the term (in this case, five years.)

Variable rates are priced as prime - %, where prime is the bank’s best lending rate, and the percentage is a discount on that rate. This allows the rate to change as prime does without affecting the calculations every time it does. A rate that is shown as prime – 0.8% would still be prime – 0.8% if prime went up or down.

Variable rates can go up or down, translating into higher or lower monthly payments, respectively.

When the term ends, your mortgage isn’t paid off. The end of a term means you’ll have to get a new term, with new conditions and interest rates.

 

 

Who is a 5-yearvariable term best for?

There are a couple reasons to go for a 5-year variable term:

1.       You want to take advantage of the discounted rates

2.       You believe rates will go down

3.       You aren’t worried about the possibility of rising rates

 

However, there are a few downsides to this as well:

1.       If rates go up, your monthly payment goes up as well

2.       They can be harder to get approved for if you have higher-than-average debt ratios

 

 

How popular is a 5-yearvariable term?

In Canada, most homebuyers do not choose a variable rate mortgage. Among those that do, 5 years is the most popular option.

Mortgage Type

Purchase During 2016

Renewal or Refinance During 2016

Did not purchase, renew or refinance in 2016

All mortgages

Fixed rate

80%

74%

66%

68%

Variable (adjustable) rate

17%

21%

27%

25%

Combination

3%

6%

6%

6%

 

With interest rates on the rise, many people may be scared of accepting a variable rate because they will probably end up paying more throughout the term. If the idea of rising rates fills you with dread, then a variable rate is not for you. You should never lose sleep over the idea of your mortgage payments.

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