Mortgage rates are still in the higher range compared to a few years ago, and many buyers feel that pressure when they run the numbers on monthly payments. The good news is that most experts expect rates to keep dropping over the next year. At the same time, home prices in many parts of Canada are trending down. That creates an interesting moment for buyers: The chance to enter the market at a lower price point, even if today’s borrowing costs feel heavy.

When you’re making a decision, it’s easy to focus only on the rate. A lower rate feels like a win because it means lower payments right away. But the rate is only one part of the full picture. The saying goes: ‘You date your rate, but you marry your amortization’. Rates are temporary. You can refinance when they fall. The structure of your mortgage and the terms you agree to will stick with you for much longer.

Rates matter less than you think

A lower interest rate does help with monthly affordability, but it should not be the only thing guiding your choice. For example, if you buy a home today at a reduced price compared to last year, that price cut could save you more than a temporary difference in rates. You also have the option to refinance later when rates fall.

Waiting for the “perfect” rate can backfire. If home prices climb again, you may end up paying more overall even if you lock in a slightly cheaper rate. Thinking short term about rates can lead you to miss the long-term savings that come from buying at a lower price today.

What to look at beyond the interest rate

There are key features beyond the interest rate that will affect your financial future:

• Amortization period: This is the length of time it will take to pay off your mortgage. A longer amortization makes monthly payments easier to handle, but you will pay more interest over the life of the loan. A shorter amortization means higher monthly payments but far less interest overall. Picking the right balance is just as important as the rate itself.
• Prepayment options: These give you the chance to pay down your mortgage faster without facing penalties. Even adding small extra payments each year can save you thousands of dollars in interest and cut years off your mortgage term. Some lenders are far more flexible than others, so this is worth looking at closely.
• Portability: If you plan to move before your mortgage term ends, portability lets you take your mortgage with you. Without this feature, moving can mean breaking your mortgage and paying a large penalty. Having portability built in gives you peace of mind and more freedom in case life changes sooner than you expect.
• Penalties for breaking a mortgage: These penalties are often overlooked, but they can be massive. Some lenders calculate penalties in a way that costs borrowers far more than others. Before signing, it is important to know exactly how penalties are calculated and what they might cost in real scenarios.
• Fixed versus variable: Choosing between a fixed or variable rate is another decision that goes beyond the headline number. A variable rate may look risky in a high-rate environment, but if rates drop over the coming years, it could pay off. A fixed rate locks in stability, but you might miss the benefit of falling rates. The right choice depends on your comfort level and financial plan.

The bigger picture

If higher short-term rates are your main concern, it is worth stepping back to look at the full landscape. Home prices are lower today, which can reduce your down payment needs and keep your overall debt smaller. Rates are also expected to continue dropping, which gives you a path to refinance into something more affordable down the road.

The bigger question is not just what your rate will be today; it’s whether the mortgage you choose sets you up with the right amortization, flexibility and terms for the future. A great mortgage is the one that works for you not just this year, but through the changes ahead.

The bottom line

Rates get the most attention, but they are only one piece of the puzzle. If you focus only on the number, you may miss the chance to save by buying at a lower price today and setting yourself up with a mortgage that supports your long-term goals. The smartest move is to look past the short-term cost of borrowing and make sure your mortgage gives you the flexibility and protection you need for years to come.