What the posted rate measures
Every Canadian bank publishes a list of posted mortgage rates, one for each term. Each Wednesday the Bank of Canada takes the five-year conventional rate posted by the six largest chartered banks and records the most typical of them: the rate that most of the six post, or, where no single rate is most common, the posted rate closest to their average. That one figure is this series, V80691335, and it runs without a gap from 1 January 1975.
"Conventional" here means a five-year fixed-rate mortgage at the bank's standard price. It is a list price, and the Financial Consumer Agency of Canada notes that your lender may offer you a discounted rate depending on your credit history, the term and the type of rate you choose. Treat it as the price a bank starts from, not the price it expects you to pay; how far below it a bank will go is not published, and it changes as banks compete for business.
Why a rate nobody pays still matters
The posted rate matters for two reasons even though few people pay it.
- Prepayment penalties. Breaking a fixed mortgage early usually costs the higher of three months' interest or the interest rate differential, and the FCAC explains that some lenders work out that differential from posted rates rather than the rate you pay. A large discount at the start can then make leaving expensive. Your mortgage contract sets out the method; read it before you sign.
- The stress test. To borrow from a federally regulated lender, you must show you could make the payments at a qualifying rate above the one you will pay. For uninsured mortgages, those with a down payment of 20% or more, OSFI's Guideline B-20 sets the minimum qualifying rate at the greater of your contract rate plus 2 points or 5.25%. Until 1 June 2021 the floor was not fixed: it was the five-year benchmark rate published by the Bank of Canada, built from the six largest banks' posted rates. OSFI replaced it because, as it said in 2020, the gap between contract rates and the benchmark had widened and the floor had become less responsive than intended.
The debt-to-income calculator shows how much of your income your debts take; run the mortgage at the qualifying rate, not the contract rate, to see what a lender will see.
How Canadian rates are compounded
A Canadian fixed rate is not divided by twelve to get a monthly rate. Section 6 of the Interest Act makes interest on a blended-payment mortgage unrecoverable unless the contract states the rate "calculated yearly or half-yearly, not in advance", and lenders settled on half-yearly compounding for fixed-rate mortgages. The monthly rate is therefore slightly lower than the quoted rate divided by twelve. The mortgage calculator uses the same convention, so the payment it gives for a rate should match your lender's figure.
How to compare it with your quote
Treat the posted rate as the top of the market, not the middle of it. A quote below it is normal; the question is how far below, and the posted rate's own history tells you little about that. Compare your quote with other lenders' quotes for the same term on the same day, and check that each is a fixed rate for five years, not a shorter term or a variable rate.
A fixed rate prices five years of borrowing, so it reflects where markets expect interest rates to be over that time, not only where the policy interest rate is today. Read the two side by side: a cut in the policy rate can leave this series unchanged for months, and the posted rate can rise in a year when the policy rate does not. For buying against renting, the rent vs buy calculator takes the rate you were offered.
Reading the chart and the table
Each point is one Wednesday, dated that Wednesday, and the series includes every week whether or not the rate moved, so long flat stretches are real: banks change their posted rates far less often than bond yields move. The table lists the most recent weeks first. The series covers five-year fixed rates at the six largest banks only, and says nothing about variable rates, insured mortgage pricing, credit unions or other lenders. It downloads as a CSV with the Bank's own dates and values.