Compare the best fixed-open mortgage rates for free.

Looking for a fixed open mortgage with no fees attached? Unfortunately, that's not something any lender in Canada offers. Every mortgage comes with some combination of costs, whether it's open or closed, fixed or variable.

The good news with a fixed open mortgage is that you'll avoid one major fee that trips up a lot of borrowers: prepayment penalties. But the other standard closing costs still apply.

Most fees fall under your closing costs, which typically run between 1.5% and 4% of your home's purchase price. These usually include:

• Mortgage default insurance: Required if your down payment is under 20%, this insurance (from CMHC, Sagen, or Canada Guaranty) protects the lender if you default. Premiums are usually rolled into your monthly payments, though you can pay them upfront instead.
• Provincial sales tax (PST): Homebuyers in Ontario, Quebec, and Saskatchewan pay sales tax on their default insurance premium at closing.
• Interest adjustment costs: If your closing date falls mid-month, you may owe interest for the days before your first regular payment kicks in.
• Appraisal fee: Lenders typically require a home appraisal before approving your mortgage, and this cost usually falls on the buyer.

You'll also want to budget for other closing-related costs, like legal fees, land transfer tax, and property tax adjustments.

No prepayment penalties

This is the defining feature of an open mortgage. You can pay off any amount, or the entire balance, at any point during your term without owing a penalty. That flexibility is the main reason people choose an open mortgage despite the higher rate that comes with it.

Because there's no penalty built in, lenders price that risk into the rate itself rather than into a fee you'd pay later. So while you're avoiding one type of cost, you're generally paying more for it elsewhere, through interest.

LowestRates.ca can help you compare today's best fixed open mortgage rates from top lenders across Canada. Just use the mortgage quoter at the top of the page.

No single lender has the lowest rate for every borrower. Fixed open mortgage rates are priced based on risk, so a stronger financial profile generally puts you in line for a better rate.

Lenders tend to offer their best rates to borrowers who:

• Have a total debt service ratio of 44% or less, and a gross debt service ratio of 39% or less
• Can pass the mortgage stress test
• Have a strong credit score
• Can put down a sizable down payment
• Have stable, verifiable income

Meeting these benchmarks widens the pool of lenders willing to compete for your business, which usually works in your favor on rate.

It's also worth knowing that open mortgage rates are structurally higher than closed mortgage rates for the same term, since you're paying for the flexibility to pay off your loan penalty-free. So the more useful question isn't "what's the lowest fixed open rate out there," but "what's the lowest rate I can get given the trade-off I'm making for flexibility."

Both can get you a competitive fixed open mortgage rate. The right choice depends on more than just the number on the rate sheet.

Brokers

Brokers work with multiple lenders at once, so they can shop your application around and compare options for you. They're usually compensated by the lender rather than charging you directly, and their volume relationships with lenders can sometimes get you a better rate than walking into a branch on your own.

Banks

Going straight to a bank works well for borrowers who value an existing relationship or brand familiarity. If you're already a customer, the bank may have faster access to your financial history, which can speed up approval. Keep in mind banks only offer their own products, so comparing rates means checking multiple banks yourself. Banks also tend to have stricter approval criteria, which can be a hurdle if you're self-employed or have less conventional income.

Finding the best mortgage product

Rather than picking a lane before you've seen your options, compare rates from both banks and brokers side by side. LowestRates.ca lets you do exactly that, so you can find the fixed open mortgage that fits your needs.

A fixed open mortgage isn't the right fit for most homebuyers, but it makes a lot of sense in specific situations.

It tends to work best for people who expect a windfall, like an inheritance, a bonus, or the proceeds from selling another property, and want the freedom to put that money straight onto their mortgage without a penalty eating into the benefit. It can also suit borrowers who plan to sell their home in the near future and want to avoid getting locked into a penalty if they pay off the mortgage before their term ends.

For most other homebuyers, especially those planning to stay put and make steady, predictable payments, a fixed closed mortgage usually works out to be the better deal. Closed mortgages come with a lower rate, and most still include prepayment privileges that let you pay down a meaningful amount each year, often up to 15% to 20% of the original principal, without triggering a penalty.

So before committing to a fixed open mortgage, it's worth asking yourself honestly how likely you actually are to pay off a large chunk of your mortgage mid-term. If the answer is "probably not," the lower rate on a closed mortgage may serve you better.

To see how fixed open mortgage rates stack up against your other options, use LowestRates.ca to start comparing today.