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Personal Banking > Mortgages > Home Buyer Resources > Mortgage Basics > Variable and Fixed Mortgages

Variable and Fixed Rate Mortgages

From the security of a fixed rate mortgage to the flexibility of the Bank’s unique RateCapper mortgage, you have several choices when it comes to interest rates.

Fixed Rate Mortgage

The interest rate for a fixed rate mortgage is locked in for the full term of the mortgage. Payments are set in advance for the term, providing you with the security of knowing precisely how much your payments will be throughout the entire term. Fixed rate mortgages can be open (may be paid off at any time without breakage costs) or closed (breakage costs apply if paid off prior to maturity).

 

Variable Rate Mortgage

With a variable rate mortgage, mortgage payments are set for the term, even though interest rates may fluctuate during that time. If interest rates go down, more of the payment is applied to reduce the principal; if rates go up, more of the payment is applied to payment of interest. Variable rate mortgages may be open or closed.

A variable rate mortgage provides you with the flexibility to take advantage of falling interest rates and to convert to a fixed rate mortgage at any time.

 
 

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Lock your rate and know exactly how much home you can afford. Start your pre-approval online and an RBC® mortgage specialist will be in touch within 24 hours to help you complete your pre-approval application.

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