Real Estate

TD Bank Mortgage Rates as of February 2024: Fixed vs Variable

The Toronto Dominion Bank, commonly known as TD or TD Bank, traces its origins back to 1855 when The Bank of Toronto was initially incorporated.

Through a merger with The Dominion Bank in 1955, TD evolved into the prominent banking institution familiar to Canadians today.

As the second-largest among Canada’s Big Six banks, TD holds a significant position in the country’s mortgage market. In the second quarter of 2023, TD’s mortgage portfolio amounted to nearly $248 billion.

Current Posted TD Bank Mortgage Rates

1-year (closed)Fixed7.84%7.939%
2-year (closed)Fixed7.34%7.391%
3-year (closed)Fixed7.14%6.764%
4-year (closed)Fixed6.99%7.016%
5-year (closed)Fixed7.04%6.511%
7-year (closed)Fixed7.10%7.115%
5-year (closed)Variable7.15%7.171%

Current Special TD Bank Mortgage Rates

3-year (closed)Fixed6.73%6.764%
5-year (closed)Fixed6.49%6.511%
5-year (closed)Variable7.15%7.171%
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TD Mortgage Products

Apart from offering conventional mortgage products, such as fixed- and variable-rate loans in both open and closed structures, TD provides:

  1. Home equity lines of credit.
  2. Mortgages for second homes and investment properties.
  3. Mortgage refinances.
  4. Mortgage renewals.
mortgage rates

Considerations for TD Mortgage Rates

Posted Rates vs. Special Rates Major lenders like TD often present two sets of mortgage rates: posted rates and special (discounted) rates.

  • TD Posted Mortgage Rates: These are the initial, non-discounted rates publicly disclosed by the bank. Typically higher than discounted rates, they serve as a starting point for negotiation.
  • TD Special Rates: Already discounted from the posted rates, these may be limited-time offers or rates extended to mortgage broker partners. Negotiating for a lower rate is still advisable even if offered a special rate.

TD Bank Fixed vs. Variable Mortgage Rates

Choosing between a fixed or variable mortgage rate is a pivotal decision when obtaining a mortgage from TD.

  • Fixed Mortgage Rates: The interest rate remains constant throughout the mortgage term, providing predictability in monthly payments. However, breaking the contract to take advantage of lower rates may result in substantial penalties.
  • Variable Mortgage Rates: The interest rate can fluctuate, impacting the distribution of payments between interest and principal. While variable rates are generally lower, economic uncertainties can lead to significant rate increases.

Prime Rate TD’s prime rate influences variable-rate lending products and variable-rate mortgage products.

It aligns with the Bank of Canada’s overnight rate adjustments, affecting borrowing costs for these products. TD’s mortgage prime rate is distinct and higher than its typical prime rate.

TD Bank Open vs. Closed Mortgages Rate

Deciding between an open or closed mortgage at TD involves considerations of flexibility and cost.

  • Open Mortgages: Allow unlimited prepayments or full payment without penalties but come with higher interest rates.
  • Closed Mortgages: Impose annual limits on prepayments, often with lower interest rates.

Convertible Mortgages TD offers a six-month, closed convertible mortgage for those uncertain about their mortgage duration.

This option allows extension to a longer term at any time, enabling borrowers to lock in at favorable rates.

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TD Bank Rate vs. APR

When assessing TD’s mortgage rates or comparing them with other lenders, it’s recommended to focus on the annual percentage rate (APR).

This figure incorporates additional fees, providing a more accurate representation of potential mortgage costs.