Women in the Know

My Money Story: 3 Reasons Why I’m Renewing into a Variable Rate Mortgage

February 20, 2025

I’m one of the 1.2 million Canadians with a mortgage coming up for renewal in 2025—and in my case, I have two: one for my primary residence and another for a vacation property.

Previously, I was locked into 5-year fixed-rate mortgages at 2.49% and 2.44%, secured when rates were near historic lows. It was my first time choosing fixed-rate mortgages, and at the time, I felt those low rates were worth locking in.

Now, I’ll be renewing into higher rates compared to my previous terms—potentially close to double my prior rate. This time, however, I’m returning to a variable rate mortgage. While this isn’t the most popular choice right now—variable-rate mortgages account for only 10% of newly originated loans in 2024, according to Canadian Mortgage Trends—it’s the best decision for me.

Here’s Why I’m Renewing into a Variable Rate Mortgage:

I expect the overnight interest rate in Canada to decrease.

Variable mortgage rates are tied to the lender’s prime rate, which is influenced by the Bank of Canada’s overnight rate. In 2024, the overnight rate dropped by 1.75% from its most recent highs, and the Bank of Canada reduced rates again in January 2025.

Given the current economic outlook, I expect this trend to continue. If I’m right, my variable mortgage rate will decrease over time, saving me money compared to locking in at today’s fixed rates.

I can handle higher rates if I’m wrong.

My amortization is low, which gives me confidence in choosing a variable rate. For those unfamiliar, amortization is the total length of time it takes to pay off your mortgage. The shorter your amortization, the larger portion of each payment goes toward reducing the principal rather than covering interest costs.

One of my mortgages has less than five years remaining, and the other has fewer than 16 years—though it’ll be paid off even faster once I redirect payments from my first mortgage to the second. If rates were to rise unexpectedly, it wouldn’t seriously impact my repayment goals or overall financial plan.

I can change my mind

Many lenders offer the option to convert a variable-rate mortgage to a fixed-rate term. If I ever decide I’m no longer comfortable with a variable rate, I have the flexibility to make the switch. It will be, however, at future rates, at the time of conversion.

It’s important to understand the terms and conditions of your mortgage. If you choose a variable rate, make sure to check if early conversion options are available. Having this flexibility gives me peace of mind with my decision.

Other Areas to Consider When Renewing Your Mortgage

Renewing your mortgage is an opportunity to reassess your financial strategy and ensure your choice aligns with your current needs and future goals. In addition to the factors I’ve highlighted, here are a few other key considerations:

Your Financial Situation

Evaluate how much flexibility you have in your budget to handle potential increases in interest rates. If you can, increase your regular payments to lower your amortization, reducing your future interest costs.

Goals for Your Mortgage and Property

Think about your long-term objectives. Do you want to pay off your mortgage faster? Is having a predictable payment schedule more important? Are you planning to sell your property or move before your term expires? Answering these questions will help you select a mortgage term that aligns with your goals.

Shop Around

Don’t automatically renew with your current lender. Research other lenders’ offerings—sometimes switching providers can save you money over the term of your mortgage.

Penalties and Prepayment Options

If you’re considering switching lenders or making lump-sum payments, review any penalties and prepayment terms associated with your mortgage.

Renewing a mortgage is a significant financial decision, but with careful evaluation of your options, you can choose a solution that best supports your goals and circumstances.

Recent Posts

Beyond ESG Ratings: How We Evaluate Responsible Investments

Beyond ESG ratings: How we evaluate responsible investments

Understanding our responsible investing process

Responsible investing has become an increasingly important part of the investment landscape. As environmental, social, and governance (ESG) investing has become more widely adopted, many investors are surprised to learn that different ESG research organizations often assign different ratings to the same company.

Rather than viewing these differences as a weakness, we believe they reflect the complexity of evaluating corporate sustainability. No single research provider captures every dimension equally well.

For this reason, we developed a proprietary ESG assessment methodology that combines multiple independent sources of research into one disciplined and consistent investment framework.

Why this matters

Responsible investing is about more than simply selecting companies with favourable ESG ratings. It requires a disciplined investment process that balances sustainability considerations with sound financial analysis.

Our methodology is designed to identify companies that demonstrate responsible corporate behaviour while continuing to meet the financial characteristics we believe are important for long-term investment success.

Our layers of ESG due diligence

July 2026 Market Update – Middle East Uncertainty, Central Bank Caution, and Resilient Economic Growth

What happened in July? Geopolitical developments in the Middle East remained an important influence on global markets during July. Renewed military activity involving the United States and Iran contributed to continued uncertainty, while developments surrounding shipping routes and energy infrastructure kept oil markets particularly sensitive to changing events. Oil prices experienced renewed volatility throughout the month, rising following heightened tensions in early July before easing later in the month as markets responded to changing geopolitical developments. Despite the late-month decline, oil prices finished July more than 20 per cent above their levels at the end of February, reflecting the ongoing impact of geopolitical risk on global energy markets. While geopolitical developments remained the primary focus for investors, economic data and central bank decisions continued to shape expectations for inflation and interest rates. The Bank of Canada and the U.S. Federal Reserve both maintained their policy interest rates during July, while inflation data suggested that price pressures remain above central bank targets despite some moderation from recent highs.

Summer 2026 Newsletter – The Wagner Investment Management Team

As we move through summer 2026, it’s a great time to take a step back from the headlines and focus on the bigger picture of your financial plan.

Discover how evolving market dynamics are shaping the investing landscape, explore the lessons that Jevons Paradox may offer for energy markets and artificial intelligence, and learn practical ways to support the next generation through homeownership, tax planning, and financial education. Plus, gain valuable estate-planning insights on navigating the transition when children reach adulthood.

Let’s make this summer a season of perspective, preparation, and opportunity – helping you stay focused on your long-term goals while we continue to navigate changing markets together.

June 2026 Market Update – Middle East Tensions, Oil Price Swings, and Easing Energy Concerns

Geopolitical tensions in the Middle East remained a key influence on global markets during June. Developments involving the U.S., Iran, Israel, Gaza, and Lebanon contributed to periods of heightened uncertainty, particularly in energy markets. Concerns surrounding shipping through the Strait of Hormuz, a key global oil transit route, led to temporary increases in oil prices during the month. However, as tensions eased, oil prices retreated approximately 30 per cent from their June 3 intraday high, ending the month near where they finished in late February.

Mid Year Market Update – June 2026

The markets have given investors plenty to think about during the first half of 2026.

The information contained herein has been provided for information purposes only. The information has been drawn from sources believed to be reliable. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance. This does not constitute a recommendation or solicitation to buy or sell securities of any kind. Wellington-Altus Private Wealth Inc. (WAPW) does not guarantee the accuracy or completeness of the information contained herein, nor does WAPW assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Before acting on any of the above, please contact your financial advisor.