When the Bank of Canada announces a rate decision, I often hear the same question from buyers: “Does that mean my mortgage rate changes today?” The answer depends on whether you are looking at a variable or a fixed rate — and on the lender’s actual offer.
The Bank influences borrowing costs, but it does not set your mortgage quote. Here is how I think about the moving parts when we are planning a Greater Sudbury purchase.
Variable rates: follow the lender’s prime rate
Variable-rate mortgages are commonly priced from a lender’s prime rate, with a discount or premium set in the mortgage contract. A change in the Bank of Canada’s policy rate usually feeds through to prime, but each lender publishes its own prime rate and decides the terms it offers. The Bank of Canada explains that link.
On March 18, 2026, the Bank held its policy rate at 2.25%. That decision does not give you a mortgage quote; your lender sets its own prime rate and offer terms.
If prime changes later, your variable mortgage rate may change. What happens to the payment depends on your contract: some variable mortgages have payments that move, while others hold the payment steady and change how much goes to interest versus principal. Ask the lender which structure it is offering and what happens if rates rise. The Bank’s variable-payment explainer shows why that distinction matters.
Fixed rates: watch funding costs, not just decision day
A fixed-rate offer is influenced by the lender’s cost of funding a mortgage over the term. Government of Canada bond yields are an important market signal for that cost, but there is no single formula that turns a bond yield into everyone’s mortgage rate. Funding, risk, expenses, competition and product terms all affect the final quote.
Bond yields can respond to inflation reports, economic data, global markets and expectations about future rates. That means a fixed-rate offer can change even when the Bank leaves its policy rate alone. The reverse can happen too: a policy-rate move does not guarantee an immediate matching move in a fixed offer. The Bank’s mortgage-rate explainer is useful background here.
If you are comparing fixed offers, ask for quotes dated the same day and with comparable terms. Comparing only the headline percentage can hide differences in prepayment privileges, penalties or flexibility. My Ontario mortgage-types guide walks through the choices.
Why two buyers can get different offers
The lender also looks at the mortgage itself and the borrower: credit history, down payment, whether mortgage insurance applies, the property and the term you choose. A lower advertised rate is not automatically the better mortgage if its conditions do not fit your plans.
The down-payment guide helps you estimate the cash side of a purchase. The separate mortgage stress-test guide explains why your qualifying rate can be higher than the rate you would pay. Neither a policy announcement nor an online rate card replaces a property-specific approval.
What I would do before shopping
I would start with a documented pre-approval and ask the lender or broker to show the payment, qualifying amount, down payment, closing cash and main contract conditions together. Then we can choose a search range that still feels comfortable after you move in. My Greater Sudbury buying guide puts that step into the full purchase process.
For a later policy announcement, use the Bank of Canada decision archive for dated context. If you are ready to see what fits your approved range, browse MLS® Smart Search or the Greater Sudbury Curated Hot Sheets.
Expect Moore for Your Real Estate.
— Chad Moore, REALTOR® | Lake City Realty