The National Bank of Canada is launching the Strategy-5, a new five-year mortgage that reduces interest rates by 1.50% for the first year and 0.30% for the following four years.

This product offers homeowners the best of both worlds: a fixed rate combined with a variable rate. The Strategy-5 Mortgage enables clients to manage their budget effectively and, because of the significant rate discount during the fist year, allows them to repay their principal more quickly than with a fixed-rate mortgage. The rate discounts also free up funds to pay for the additional expenses related to buying a home.

The Strategy-5 Mortgage has a maximum amortization period of 25 years and payments are calculated using the current rate for a 1-year term minus 1.50% for the first year and minus 0.30% for the following 4 years. The payment amount is adjusted annually using the interest rate in effect on the review date.