Published 2 November 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
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Prime rose from 4.45% to 4.70% on 29 October 2026, so most variable rates rose 0.25 points. If your payment adjusts, a $600,000 mortgage on a 25-year amortization costs about $82 more a month. If your payment is fixed, it stays the same but less goes to principal.
This guide is for Ontario homeowners with a variable-rate mortgage who want to know exactly what the 28 October 2026 rate hike does to their payment. You will see worked examples, learn the difference between the two kinds of variable mortgage, and find out what a trigger rate is and how to check yours.
What is the prime rate in Canada today?
As of November 2026, the big-bank prime rate is 4.70%. It was 4.45% until the Bank of Canada raised its policy rate from 2.25% to 2.50% on 28 October 2026. RBC, TD, National Bank and other lenders raised prime by the same 0.25 points the next day, 29 October.
Your variable rate is almost always written as prime plus or minus a fixed margin. The Financial Consumer Agency of Canada (FCAC) explains it simply: the margin stays the same for your whole term, so your rate moves exactly as prime moves. If you signed at prime minus 0.30%, you were at 4.15% and you are now at 4.40%.
| Your margin | Rate before (prime 4.45%) | Rate now (prime 4.70%) |
|---|---|---|
| Prime minus 0.50% | 3.95% | 4.20% |
| Prime minus 0.30% | 4.15% | 4.40% |
| Prime + 0.00% | 4.45% | 4.70% |
| Prime + 0.50% | 4.95% | 5.20% |
Source: Bank of Canada, 28 October 2026; National Bank of Canada and TD prime rate notices; FCAC, Interest on mortgages.
What are today’s variable mortgage rates in Ontario?
Advertised rates change often, so treat these as a snapshot. On 2 November 2026, RBC’s website showed a five-year variable special offer of prime minus 0.30% (4.40%) for amortizations of 25 years or less, and prime minus 0.20% (4.50%) for longer amortizations. Its posted variable rate was prime, 4.70%. The same page showed a five-year fixed special offer of 5.14%.
Brokers and smaller lenders may quote different discounts. Your own rate depends on your down payment, whether your mortgage is insured, your credit and the property. A licensed mortgage professional can tell you what you would actually be offered. My comparison of using a mortgage broker or a bank in Ontario explains the trade-offs.
How much does my variable mortgage payment go up after the hike?
If your payment moves with prime, a $600,000 mortgage on a 25-year amortization goes up about $82 a month. Here is the same example at other balances. These are illustrations, not quotes.
| Balance | Monthly payment at 4.15% | Monthly payment at 4.40% | Increase per month | Increase per year |
|---|---|---|---|---|
| $400,000 | $2,137 | $2,192 | $55 | $660 |
| $600,000 | $3,205 | $3,288 | $82 | $990 |
| $800,000 | $4,273 | $4,383 | $110 | $1,319 |
| $1,000,000 | $5,342 | $5,479 | $137 | $1,649 |
Source: my calculations; prime minus 0.30%, 25-year amortization, monthly payments, semi-annual compounding, rounded. Illustration only. Your lender’s method of compounding and your remaining amortization will change the exact figure.
A good rule of thumb: every 0.25-point move in prime changes the payment by roughly $13 to $14 a month for every $100,000 you owe on a 25-year amortization.
What if the Bank of Canada raises rates again?
Some forecasters expect more increases. RBC’s chief economist said after the October decision that RBC projects three more hikes in total. Desjardins expects one more. Markets priced roughly a 43% chance of a hike on 9 December 2026. These are forecasts, not facts, but it helps to see what each step would cost.
| Scenario | Prime | Your rate (prime minus 0.30%) | Payment on $600,000 | Change vs before Oct 28 |
|---|---|---|---|---|
| Before 28 Oct 2026 | 4.45% | 4.15% | $3,205 | None |
| Now | 4.70% | 4.40% | $3,288 | +$82 |
| One more 0.25 hike | 4.95% | 4.65% | $3,371 | +$166 |
| Two more hikes | 5.20% | 4.90% | $3,456 | +$250 |
| Three more hikes | 5.45% | 5.15% | $3,541 | +$336 |
Source: my calculations, 25-year amortization, semi-annual compounding. Hypothetical scenarios, not a forecast.
Notice that three more hikes would put this variable payment about level with the 5.14% five-year fixed offer RBC showed on 2 November. That is the core of the lock-in question, and it is why the choice is closer than it looks.
Free tool — what can you actually afford?
What is the difference between a fixed-payment and an adjustable-payment variable mortgage?
Both have a rate that moves with prime. The difference is what happens to your payment.
- Adjustable-payment variable. Your payment changes when the rate changes. The FCAC notes that a set amount of each payment always goes to principal, and only the interest part moves. You always know how much of the loan you will have paid off by the end of the term. The downside is a less predictable budget.
- Fixed-payment variable. Your payment stays the same. When the rate rises, more of that same payment goes to interest and less to principal. The FCAC warns this can be riskier than people expect, because a big enough rise means your payment stops reducing the loan at all.
Not every lender offers both. Some, like RBC, keep the payment set for the term and change the split between principal and interest, with a payment increase if a trigger is reached. Your mortgage agreement says which kind you have.
| Rate on a $600,000 balance (payment fixed at $3,205) | Interest part (first month) | Principal part (first month) |
|---|---|---|
| 4.15% (before the hike) | $2,057 | $1,148 |
| 4.40% (now) | $2,180 | $1,025 |
| 4.90% (after two more hikes) | $2,425 | $780 |
| 5.40% | $2,670 | $535 |
Source: my calculations, semi-annual compounding. Illustration only.
In this example, the hike alone means about $1,500 less principal paid off over the next year, even though the payment did not change.
What is a trigger rate on a mortgage?
A trigger rate is the interest rate at which your fixed payment covers only the interest, with nothing left for principal. The FCAC calls it the trigger point and says it is written in your mortgage contract. Some banks call it a “triggering interest rate”.
In the example above, a $600,000 balance with a $3,205 payment would reach its trigger at roughly 6.5%. That is far above today’s 4.40%, so this borrower is not close. But borrowers who took fixed-payment variable mortgages when rates were much lower, or who stretched their amortization, may be closer. Above the trigger, unpaid interest is usually added to what you owe. That is called negative amortization, meaning the balance grows instead of shrinking.
Hitting your trigger rate is not the end of the story. Your contract may also have a trigger point, which is the balance or amortization at which the lender must raise your payment so the loan is still paid off on time. That increase can be large. The FCAC advises checking your trigger rate and calling your lender early. Its guideline for banks lists relief some lenders have offered, such as waiving the penalty on lump-sum payments made to stop negative amortization.
What are my options if my payment no longer covers the principal?
The FCAC lists the main options. You can raise your regular payment, make a lump-sum payment, switch to a fixed rate, or extend your amortization. Each has a cost. Higher or lump-sum payments use cash now but save interest. Switching to fixed gives certainty, but today’s fixed rates are higher than most variable rates. Extending the amortization lowers your payment, but you pay more interest over the life of the loan. There is no right answer for everyone, which is why it is worth running your own numbers with your lender or a licensed mortgage professional.
How do I find out my trigger rate and what I owe?
You do not need to guess. Use these steps:
- Open your mortgage agreement or online banking and find the words “trigger rate”, “triggering interest rate” or “trigger point”.
- Look at your latest statement and note how much of the last payment went to principal.
- Compare your current balance with the balance a year ago. If it barely moved, you are closer to your trigger than you think.
- Call your lender and ask three questions: What is my trigger rate today? What is my remaining amortization? What would my payment be if I switched to adjustable payments or to a fixed rate?
How does the rate hike affect a HELOC?
Most HELOCs are priced at prime plus a margin, so yours rose 0.25 points on 29 October. On a $100,000 balance, that adds about $21 a month in interest. Because many HELOCs allow interest-only payments, a rising rate does not reduce your balance at all. If you used a HELOC to fund a renovation or a down payment, consider paying it down before adding new debt. My guide to HELOC vs refinance vs selling compares the options.
This is my view, not financial advice. If you have an adjustable-payment variable and the extra $80 to $140 a month fits, there is no need to panic. The hike is real but small. If you have a fixed-payment variable, the hike matters more than it looks, because it quietly slows how fast you pay down your loan. In both cases, run the “three more hikes” line in the table against your budget. If that number would hurt, speak with a licensed mortgage professional about your options now, while you have time and choices, rather than after a letter from your lender.
If you are weighing whether to switch, read my guide to fixed or variable mortgages. If your term ends soon, my notes on what the payment increase looks like at renewal will help.
What to do next
- Confirm your margin (for example, prime minus 0.30%) and work out your new rate from prime of 4.70%.
- Check whether your variable mortgage has adjustable or fixed payments, and find your trigger rate.
- Test your budget against the “three more hikes” payment in the table above.
- If you have a HELOC balance, make a plan to pay it down.
- Book a call with a licensed mortgage professional before 9 December 2026 if any of the numbers worry you.
Need help with this? Talk to me.
I’m Jatin Dua, Broker of Record at RE/MAX Quantum Realty, and I’m the best agent to do this kind of work for you in Toronto and across the GTA. Over $100 million in GTA sales and 100+ families helped sell. Feel free to contact me any time: call or text 833-330-1925 or email [email protected].
Frequently asked questions
What is the prime rate in Canada right now?
The big-bank prime rate in Canada is 4.70% as of November 2026. Major lenders including RBC, TD and National Bank raised it from 4.45% on 29 October 2026, after the Bank of Canada lifted its policy rate to 2.50%. Variable mortgages and HELOCs are priced as prime plus or minus a margin.
How much did variable mortgage payments go up in October 2026?
Variable mortgage payments that adjust with prime rose about $13 to $14 a month per $100,000 owed on a 25-year amortization. On a $600,000 balance that is about $82 a month, or $990 a year, moving from 4.15% to 4.40%. The figures are illustrations; your lender’s statement will show the exact amount.
What happens when you hit your trigger rate?
When a fixed-payment variable mortgage hits its trigger rate, the whole payment goes to interest and none to principal. Above that rate, unpaid interest is usually added to the balance. In Canada, the FCAC says the lender may then raise your payment or ask for a lump sum, so call your lender early.
How do I know if my variable mortgage has fixed payments?
Your mortgage agreement and statements say whether your variable mortgage has fixed or adjustable payments. If your payment stayed the same after the October 2026 prime increase but the principal part shrank, you have fixed payments. If your payment went up, you have adjustable payments. Your lender can confirm by phone.
Are variable mortgage rates going up in Ontario?
Variable mortgage rates in Ontario rose 0.25 points on 29 October 2026, when prime moved from 4.45% to 4.70%. Whether they rise again depends on the Bank of Canada. Its next decision is 9 December 2026, and RBC and Desjardins economists expect at least one more hike, though forecasts can change.
Is a variable rate still cheaper than fixed in Canada?
A variable rate was still lower than a five-year fixed rate at major banks in early November 2026. RBC showed prime minus 0.30% (4.40%) variable against 5.14% fixed on 2 November 2026. If prime rose three more times, that variable rate would roughly match the fixed rate.
Does a rate hike affect my HELOC?
Yes, a rate hike raises the interest rate on most HELOCs in Canada right away, because they are priced at prime plus a margin. After prime rose to 4.70% on 29 October 2026, interest on a $100,000 balance went up about $21 a month. Interest-only payments do not reduce the balance.
What is negative amortization on a mortgage?
Negative amortization means your mortgage balance grows instead of shrinking, because your payment no longer covers all the interest. In Canada it happens on fixed-payment variable mortgages when rates pass the trigger rate. Unpaid interest is added to the loan, and you may need to pay more later or at renewal.
Can my bank increase my variable mortgage payment?
Yes, your bank can increase your variable mortgage payment when prime rises if you have an adjustable-payment mortgage, or when you reach your trigger rate or trigger point on a fixed-payment one. The terms are in your contract, and lenders send a notice of the new payment; RBC, for example, calls it a Payment Change Notice.
Sources
- Bank of Canada raises the policy rate by 25 basis points to 2½% (28 Oct 2026)
- National Bank of Canada increases its prime rate (28 Oct 2026)
- RBC Royal Bank mortgage rates
- RBC: Fixed vs variable rates
- FCAC: Interest on mortgages
- FCAC: Managing your money when interest rates rise
- FCAC: Report on the Guideline on Existing Consumer Mortgage Loans in Exceptional Circumstances
- Investment Executive / The Canadian Press: Bank of Canada delivers 1st hike in three years
Related reading
- The Bank of Canada Raised Rates: What It Means for GTA Buyers, Sellers and Owners
- Should I Lock In My Variable Mortgage Before 2027?
- Mortgage Renewal in 2027 After the Rate Hike: Your Options in Ontario
- Will Mortgage Rates Go Down in 2027? What to Plan For in Canada
About the author — Jatin Dua, Toronto and GTA real estate broker
I am Jatin Dua, Broker of Record and co-founder of RE/MAX Quantum Realty Inc., Brokerage, Unit 101, 799 The Queensway, Toronto. I work with buyers and sellers across Toronto and the GTA and have helped more than 100 families sell. Four-plus years of active GTA transactions and over $100 million in sales volume.
Reach me at [email protected] or 833-330-1925, or book a call.