What is the difference between floating rate and fixed rate mortgages?
Variable or floating rate mortgages provide that the interest rate will change on a periodic basis during the term of the loan according to a pre-determined formula. This formula is typically based on the prime-lending rate set by the Bank of Canada.
Fixed rate mortgages provide that the interest rate will not change throughout the term of the mortgage but is set at a fixed rate at the beginning of the term.