The Big 6 Banks in Canada: How Their Mortgage Products, Rates, and Policies Compare

RBC, TD, Scotiabank, BMO, CIBC, and National Bank all sell mortgages, but their rate discounts, prepayment rules, and portability windows differ in ways that cost thousands. Walk into a branch on Bay Street or a Calgary strip mall. The rep promises a straightforward product, slides over a five-year commitment with a competitive discount, and asks for a signature. They skip the legal charges, the penalty formulas, and the deadlines that kick in the moment your life changes mid-term.

Collateral charges vs standard charges: the fine print behind the rate

The legal charge registered against your title at the land registry dictates whether you can walk away at renewal. The Big 6 handle this step differently.

TD registers every residential mortgage as a collateral charge by default, often for 100% or 125% of the purchase price. National Bank does the same. The pitch sounds clean: borrow more later as your home appreciates without paying a lawyer to refinance. The reality is handcuffs.

A standard charge registers only the balance you borrow. At maturity, it transfers to a competitor through a simple legal assignment, and the new lender almost always covers the switch costs. A collateral charge cannot be assigned. Moving a mortgage from TD or National Bank at renewal forces your new lender to discharge the old charge and register a new one. You pay the legal fees. Some lenders run promotions to cover those bills, but many do not. Your bank knows it.

Scotiabank, RBC, BMO, and CIBC still register standard charges on standalone fixed and variable products. Steer clear of their umbrella borrowing packages, and your exit route stays open. Title registration matters as much as the rate when comparing Big 6 bank mortgages Canada.

To see how credit unions and non-bank lenders handle title, read our guide on Bank vs. Mortgage Broker vs. Credit Union: Where Should Canadians Get Their Mortgage?.

Prepayment privileges and lump sums: 10% vs 20% flexibility

Every major bank caps how much principal you can pay down penalty-free each year. If you collect an annual bonus, receive an inheritance, or manage lumpy business revenue, those caps dictate how fast you shed debt.

The spreads across the Big 6 are wide:

• BMO: Offers a 20% annual lump sum on the original principal balance and allows you to increase your regular payment by up to 20% once each calendar year.
• CIBC: Allows up to 10% or 20% annual lump sums depending on the mortgage tier selected, alongside a 100% payment increase option over the original payment amount.
• Scotiabank: Allows a 15% lump sum per year based on the original balance. Their "Match-a-Payment" feature also allows you to pay an extra regular payment on any regular payment date.
• TD: Grants a 15% annual lump sum on the original loan balance, with a 15% payment increase allowance once every 12-month period.
• RBC: Restricts lump sums to 10% per year based on the original principal balance, with a 10% payment increase option. They offer a double-up payment feature for ongoing cash flow adjustments.
• National Bank: Typically limits prepayments to 10% of the original principal each calendar year, with a 10% regular payment increase.

A 10% cap on an $800,000 mortgage blocks you from paying down more than $80,000 a year without a penalty. Liquidate $150,000 from company shares or an investment property, and a 10% rule forces you to park the rest in taxable accounts while your non-deductible debt accrues interest.

Test your numbers with our mortgage payment calculator to see how modest prepayments shorten a 25-year amortization.

The posted-rate trap: how the Big 6 calculate IRD penalties

The Interest Rate Differential (IRD) calculation is the most punishing clause in Canadian lending. The Big 6 run this formula to protect their balance sheets, not yours.

Standard advice calls a five-year fixed mortgage with a big bank the safe pick. It isn't. Across fifteen years of brokering files in Canada, I have seen that advice wreck household finances. Telling an everyday buyer to lock into a five-year bank contract is reckless. Roughly 60% of Canadian borrowers break or alter a five-year fixed mortgage by month 36. Twins arrive. A job transfers from Calgary to Toronto. Couples split. Life intervenes, and the bank calculates the exit fee using an artificial "posted rate." Where a monoline lender charges $3,000 to $5,000, a Big 6 bank demands $22,000 or $35,000 on the identical balance.

Here is the mechanics of the trap. At signing, the bank grants a discount off their posted rate—an inflated number no one pays. Break the term after three years, and the bank calculates its loss by comparing your contract rate against its current posted rate for the remaining two years, minus that original discount. The artificial gap balloons on paper. Even with minor market shifts, the bank books a catastrophic loss. You write a five-figure cheque to sell your home.

Before signing with a chartered bank, compare current Canadian mortgage rates to see how monoline lenders price the same terms without inflated posted rates.

Porting your mortgage when you move: 30 days vs 120 days

Porting transfers your contract, remaining amortization, and rate to a new property, bypassing prepayment penalties. The catch is the calendar.

In an RBC mortgage vs TD Bank matchup, TD gives you 120 days between selling and buying to finalize the port and claim your penalty refund. RBC allows 90 days. Scotiabank gives you 90. CIBC ranges from 30 to 90 days depending on your specific contract.

Thirty days is nothing in Canadian real estate. A buyer waives conditions for late May, your seller needs until July, and the 30-day clock runs out. Once it expires, the mortgage dies. You pay the full penalty. Your rate disappears. You start a fresh application under the OSFI stress test, qualifying at the higher of your contract rate plus 2% or 5.25%.

Blending rules differ just as sharply. Upsize from a $500,000 condo to an $850,000 house, and you need $350,000 in new borrowing. Banks "blend and extend," weighting your old rate and current rates by loan amount. Some reset your term back to five years; others preserve your original maturity date. To see how closing dates collide with bank rules, read Buying a Home in Ontario: The Complete 2026 Guide for First-Time and Move-Up Buyers.

Readvanceable mortgages and HELOCs: the umbrella framework

Readvanceable mortgages pair an amortizing loan with a home equity line of credit under a single global limit. For investors tapping equity, this is where the Big 6 separate.

OSFI caps the revolving portion at 65% of property value, with total borrowing capped at 80% loan-to-value. Every dollar of principal you pay down instantly transfers to your available credit limit. No paperwork. No reapplying.

The products go by different names across the Big 6:

• Scotiabank STEP (Scotia Total Equity Plan): The gold standard for multi-property real estate investors. Scotiabank allows you to split the global charge into multiple sub-accounts. You can hold a fixed mortgage for your primary home, a variable mortgage for a rental property, and two distinct revolving lines of credit, all cleanly separated for tax accounting.
• RBC Homeline Plan: Offers separate segments for fixed, variable, and revolving credit, but lacks the flexible multi-property utility of the STEP. Porting an RBC Homeline to a new property can also trigger friction if you hold multiple portions.
• TD Home Equity FlexLine: Allows up to three fixed portions alongside a revolving line of credit. Because TD registers collateral charges on almost everything, setting up a FlexLine is fast, but restructuring it later can carry administrative costs.
• CIBC Home Power Plan: Allows you to split borrowing into fixed and revolving pools, but re-segmenting requires manual branch intervention.
• BMO Homeowner ReadiLine: Offers standard readvancing mechanics, though their customer-facing portal makes tracking distinct investment-versus-personal interest deductions cumbersome.
• National Bank All-in-One: Outstanding functionality for self-employed individuals and investors, operating almost like a unified treasury account where your income lands directly against your debt balance to minimize interest daily.

Check current HELOC rates to track revolving borrowing costs, or read How Mortgage Brokers Get Paid in Canada (And Why It's Free for You) to see how retail bank products compare against broker channels.

These structural trade-offs shift if your finances sit outside standard guidelines. Incorporated professionals with retained earnings inside holding companies, newcomers using alternative asset verification, and high-net-worth clients in private wealth divisions get bespoke credit structures wholesale lenders cannot touch. Discretionary rate pricing and portfolio exceptions can dwarf the drag of an IRD penalty or collateral charge. But if you earn standard T4 income and buy one home, signing an inflexible five-year contract with a major bank without checking the back-end terms is an expensive habit.

AI-assisted content for informational purposes only. Not financial, mortgage, or legal advice. Consult a licensed mortgage professional for your situation.