The fixed vs. variable decision depends on where you think rates are going. This calculator lets you set your expected number of Bank of Canada rate cuts or hikes over the term and shows you the total interest cost under each scenario — so you can see exactly at what point variable beats fixed.
Model how BoC rate changes affect your total cost over a 5-year term
Enter your mortgage balance, the best available 5-year fixed rate, and the best available variable rate today. Select your amortization period. Then use the rate cuts/hikes slider to model different Bank of Canada scenarios: drag left for rate cuts (variable gets cheaper), drag right for rate hikes (variable gets more expensive).
The results update instantly, showing total interest paid under each scenario for both fixed and variable.
The scenario grid shows total interest paid for fixed and variable under each rate path. At zero cuts or hikes (hold), you can see whether the current rate gap already favours one option. As you add cuts, the variable advantage grows. As you add hikes, fixed eventually wins.
The key number to watch is the break-even point — how many rate hikes the Bank of Canada would need to make before fixed becomes the better choice. If that number seems unlikely given the current economic environment, variable may be the smarter bet. If rate hikes seem possible within your term, fixed provides certainty.
This calculator models rate changes as immediate and permanent, which is a simplification. In reality, BoC rate changes happen gradually over time. The Fixed vs Variable Break-Even Calculator provides a more precise analysis if you want to model partial rate changes over specific time periods.
Remember: variable rates in Canada are tied to the prime rate, which moves in lockstep with each BoC announcement. One 0.25% BoC cut or hike changes your variable rate by exactly 0.25%.
Variable rates are currently lower than fixed rates. Variable wins if the Bank of Canada holds or cuts rates further. Fixed wins if rates rise unexpectedly. Use this calculator to see how many rate hikes it would take for fixed to come out ahead.
Variable rates are tied to the prime rate (currently 4.45%). The best variable rate offers a discount off prime — often Prime minus 0.50% to Prime minus 0.75%, giving effective rates around 3.70%–3.95%.
Yes, most variable-rate mortgages allow you to lock into a fixed rate at any time. However, your lender sets the fixed rate you convert to — it may not be the best available rate. You can also break and refinance with any lender.
Each 0.25% BoC cut or hike changes your variable rate by 0.25%. On a $500,000 mortgage, a 0.25% rate change equals roughly $100–$120/month in payment difference.
Explore current rates from 16+ Canadian lenders, or read our guides to understand your options.