The length of mortgage terms range from six months up to 25 years. Typically the shorter the term, the lower the interest rate and the longer the term, the higher the rate will be. A five year mortgage is the most popular term chosen by Canadians.
You may consider a short-term mortgage if you have a higher tolerance for risk, if you have time to watch rates or are not prepared to make a long-term commitment right now, or if you plan to sell your home in the near future.
If you have a strict budget and want to manage your monthly expenses, a longer term may suit you better. Do you believe that interest rates have bottomed out and are not likely to drop more? If that’s the case, a long mortgage term may be the right choice for you.