Compare BMO Mortgage Rates in Canada
Whether you’re considering a fixed or variable mortgage, CompareMortgages.ca provides up-to-date BMO rates alongside offerings from other major Canadian lenders.
Our platform ensures you have access to the most competitive mortgage options that suit your financial goals and budget. Why limit yourself to a single lender when we can help you compare multiple options quickly and easily?
Key Highlights
- BMO offers fixed and variable mortgage rates and a HELOC option called the Homeowner ReadiLine.
- Flexible mortgage pre-approval allows up to a 130-day rate hold, the longest of major Canadian banks.
- BMO allows the highest annual mortgage prepayment (up to 20%) of the original loan balance for most closed mortgages.
Compare BMO Mortgage Rates
Below is a table displaying the best rates from the five largest banks in the country. You can easily compare the rates offered by major Canadian lenders and banks, including TD, RBC, CIBC and Scotiabank. We do the research to guarantee you the lowest possible rates upfront every time.
Compare Big Bank Rates
Securing Canada’s most favourable mortgage or loan terms starts with comparing rates from big banks. Interest rates and promotional offers can vary significantly, potentially leading to substantial savings over the life of your loan.
Take Action Today:
- Explore Multiple Options: Don’t settle for the first offer. Research rates from various top lenders and banks across Canada to identify the most competitive options.
- Consider Your Financial Needs: Assess your budget, financial goals, and risk tolerance to determine the loan term and type that best suits you.
- Make an Informed Decision: With comprehensive rate comparisons, make a confident choice that matches your financial needs.
Comparing rates can translate to significant savings and a more favourable financial future.
BMO Overview & Stock Information
Founded in 1817, the Bank of Montreal is Canada’s oldest incorporated bank. Until 1934, when Canada’s central bank, the Bank of Canada (BoC), was created, the Bank of Montreal acted as Canada’s unofficial central bank to the federal government. The Bank of Montreal printed bank notes and minted coins for 125 years, ending in 1942.
In 2022, it began operating as BMO, and today, it ranks as the fourth-largest of Canada’s “Big 6” banks, alongside TD, RBC, Scotiabank, CIBC, and National Bank.
Stock information
What to Know About BMO Mortgage Posted Rates
BMO’s posted rates are used to calculate prepayment penalties. When obtaining a mortgage, borrowers are typically offered a discount from the posted rate.
BMO’s advertised rates may differ from those offered through mobile mortgage specialists, brokers or in-branch. Special offers, promotional rates, or alternative channel discounts often offer lower pricing than advertised. The actual rate you will be offered depends on personal factors like your mortgage amount, loan-to-value (LTV) ratio, property type, risk profile, and credit profile.
BMO also provides a limited-time cashback offer if you meet the eligibility criteria. However, this incentive may come with higher rates or require repayment of the cashback if you break your mortgage before the end of the term.
BMO Mortgage Products
Fixed-rate mortgages at BMO protect you from rising rates and allow you to know exactly how much your mortgage payment will be over the term. BMO offers fixed mortgages with 6-month, 1, 2, 3, 4, 5, 6, 7, and 10-year terms. Each mortgage payment will remain the same over the mortgage term and comprises a principal and interest component. You must renegotiate a new interest rate at the end of each term.
Variable-rate mortgages (VRM) at BMO offer interest rates based on the BMO prime lending rate, which may increase or decrease over the mortgage term based on changes to the BoC policy rate. You can choose a 3-year open or 5-year closed variable term at BMO.
Variable mortgages at BMO have payments that remain the same over your mortgage term, regardless of changes to interest rates. However, the amount applied to the principal and interest will fluctuate based on changes to BMO’s prime lending rate.
When the prime rate increases, more of the mortgage payment goes toward the interest and less toward the principal, which could leave you negatively amortized. When the prime rate decreases, more of the mortgage payment goes toward the principal and less toward the interest, helping you pay off your mortgage faster.
Besides the typical core mortgage products offered by most banks, BMO also provides a variety of other mortgage products, including:
Convertible Fixed Rate Mortgage
This mortgage offers the same benefits as a closed mortgage for 6 months. A convertible mortgage allows the flexibility to change to a longer fixed term of 1 year or more at any time without paying a prepayment penalty.
BMO Homeowner ReadiLine
This collateral charge mortgage allows you to combine a mortgage with a flexible revolving line of credit to always have access to funds. You can borrow up to 80% of your property value less the remaining mortgage balance. You can choose how to allocate the borrowing amount between the mortgage and revolving line of credit; however, you cannot exceed 65% of the value of your property on the revolving line of credit. As you pay off the mortgage balance, the credit limit on the revolving line increases.
Key Features of BMO Mortgages
- 130-Day Rate Guarantee: This allows you to lock in your pre-approved rate for 130 days, giving you more time than other banks.
- Take a Break Option: This allows you to skip up to one month of mortgage payments per calendar year. You can skip one monthly payment, up to two bi-weekly or semi-monthly payments, or up to four weekly payments. Restrictions apply, and this option is not available on BMO’s Smart Fixed Mortgage.
What Determines BMO’s Mortgage Rates?
Lenders like BMO set their mortgage rates based on the Bank of Canada (BoC) policy rate or bond yields. The state of the economy in Canada and globally, inflation, and employment can all impact the direction of bond yields and the BoC’s monetary policy decisions, impacting mortgage rates.
Variable mortgage rates are directly tied to the Bank of Canada policy rate. When the BoC changes the policy rate up to 8 times a year, lenders adjust their prime rates accordingly. Most lenders set the prime rate at 2.20% higher than the policy rate.
Fixed mortgage rates are directly tied to the movement of bond yields with a corresponding maturity. For example, 5-year fixed rates follow the direction of 5-year bond yields. Bond yields are indirectly influenced by what the market thinks the BoC will adjust the policy rate to in the future. Depending on the lender, fixed rates are typically priced 1% to 2% higher than the corresponding bond yield.
Other factors, such as your credit score, loan-to-value (LTV) ratio, down payment, debt service ratios and more, can impact the rates or discounts BMO offers you.
BMO Mortgage Payment Increases
In the mortgage industry, a prepayment is when a borrower pays off a portion or the entire mortgage early, either with a lump sum payment or by raising their regular monthly payments. Your annual mortgage prepayment limit will vary from one major bank to another. If you want the freedom to pay off your mortgage early, you will want to shop around for a mortgage with favourable prepayment terms.
Whether you have a BMO variable-rate mortgage or a BMO fixed-rate mortgage, flexible payment options allow you to pay off your mortgage faster. If you currently make monthly payments, you can switch to an accelerated weekly or biweekly schedule to help you become mortgage-free faster and save thousands.
Depending on your mortgage, you can increase your regular payment amount once each calendar year by up to 10% of your current mortgage if you have a BMO Smart Fixed Mortgage, or up to 20% for any other closed mortgage. For example, if you currently pay $800 biweekly toward your mortgage, you can increase your payment by up to $80 with a Smart Fixed Mortgage or up to $160 with all other closed mortgages at BMO once per year.
BMO Annual Mortgage Prepayment
If you have a BMO Smart Fixed Mortgage and take advantage of yearly prepayment privileges, you can pay off up to 10% of the loan balance annually without penalty. You can prepay up to 20% of your original loan balance annually without penalty if you have any other type of closed mortgage with BMO.
If you have an open mortgage, you can make as many lump-sum payments as you like each year without a prepayment penalty.
Since the entire lump sum will be applied to the principal balance of the mortgage, you will pay significantly less interest throughout the mortgage’s lifetime and be able to pay it off much more quickly.
Important: You will incur a penalty if you choose to prepay your BMO Smart Fixed Mortgage by more than 10% or prepay more than 20% of the mortgage principal per year for all other closed mortgages.
| Canadian Bank Closed Mortgage | Prepayment Amounts |
|---|---|
| RBC | 10% |
| National Bank | 10% |
| CIBC | 10% |
| TD Bank | 15% |
| Scotiabank | 15% |
| BMO | 20% |
Frequently Asked Questions
Can I negotiate my mortgage rate with BMO?
You should always negotiate your mortgage rate, as the first offer is rarely their best. However, BMO may offer rate discounts that will vary based on your credit profile, LTV, down payment, and debt service ratios.
What is the difference between fixed and variable mortgage rates?
Fixed rates provide predictable payments that remain constant throughout the mortgage term. Variable rates fluctuate with the BMO mortgage prime rate, but your payment won’t. If rates decrease, less of your payments go toward interest and more toward principal, helping you pay off your mortgage faster.
If rates rise, more of your payments will go toward interest and less to principal, which could require you to increase your payment amount, prepay, or convert your mortgage to a fixed term should rates increase to the point your regular payment no longer covers the full interest amount (negative amortization).
Does BMO offer mortgage pre-approvals?
Yes, BMO offers mortgage pre-approvals. You can lock in your pre-approved rate for up to 130 days while you shop for the perfect home.
Final Thoughts
BMO offers a variety of mortgages to suit many borrowers’ needs. While BMO may be a great option, it is always advisable to shop around for the best rate and terms whenever borrowers are in the market for a new mortgage, renewing, or refinancing.
Ready to find the best mortgage rate for your needs? Use Compare Mortgages to explore BMO offerings alongside those of other top Canadian lenders.