Discounted Rate
The actual rate a lender offers a borrower after discounting from the posted rate — what you actually pay on the mortgage.
The discounted rate is the actual interest rate a lender offers you on your mortgage, as opposed to the posted rate they advertise. Discounted rates reflect your credit profile, loan-to-value, insured vs. uninsured status, and negotiation. A Big 5 posted 5-year fixed of 6.49% might have a discounted offer at 4.79% — the 170 bp discount is what you actually pay. Discounted rates are what should be compared across lenders; posted rates are marketing artifacts.
Related Terms
The artificially high rate lenders publicly advertise — rarely paid by actual borrowers, but used for IRD penalty calculations at Big 5 banks.
A mortgage where the interest rate is locked for the full term, keeping your monthly payment constant regardless of Bank of Canada decisions.