Posted Rate
The artificially high rate lenders publicly advertise — rarely paid by actual borrowers, but used for IRD penalty calculations at Big 5 banks.
A lender's posted rate is the headline rate they advertise to the public — typically 1.5–2.5 percentage points higher than the actual rate any borrower would pay. Posted rates exist primarily for two reasons: (1) to make 'discounted' rates look larger in advertising, and (2) to serve as the reference for Interest Rate Differential (IRD) penalty calculations at Big 5 banks. When a Big 5 customer breaks a 5-year fixed, the bank calculates IRD against their posted rate, which produces penalties 2–3x larger than using the actual contract rate. Monoline lenders typically don't use posted rates for IRD, which is why monoline penalties are materially smaller.
Related Terms
The actual rate a lender offers a borrower after discounting from the posted rate — what you actually pay on the mortgage.
The larger of two penalty calculations applied when breaking a fixed-rate mortgage early at the Big 5 banks — often the difference between your posted rate and the lender's current posted rate.
A mortgage where the interest rate is locked for the full term, keeping your monthly payment constant regardless of Bank of Canada decisions.