How Are Canadians Choosing Their Mortgage Lenders?

Canadians are entering the mortgage market with a clear focus on competitive rates and seamless digital experiences. As borrowers compare more actively than ever, lenders that deliver clarity, value, and timely engagement are winning the next wave of homeowners.

Posted on: Wednesday Mar 25th 2026

Article by: Heidi Wilson

For financial institutions, a mortgage is more than a lending product; it is often the cornerstone of a long-term relationship with their customers that can anchor deposits, investments, and future borrowing. For homeowners, few moments are as consequential as the mortgage decision. A mortgage represents something far more immediate and tangible: the single largest financial commitment most will ever make.

It is therefore unsurprising that when Canadians enter the mortgage market, they behave differently than when opening everyday financial products. Convenience matters, brand familiarity matters, and advice certainly matters but above all, the economics must make sense. Looking back to 2024-5 we see a clear illustration of this dynamic.

The 2025 Switching Study tracked new and re-newed mortgage accounts from March 2024 through to March 2025, during a twelve-month period marked by considerable volatility in interest rates. Over the course of that year, the prime rate fluctuated from 5% to 2.75%. As borrowing costs began to ease, purchase affordability improved and first-time homebuyer activity responded accordingly, with a seven-point significant increase vs last wave.

For lenders, this created a window of opportunity. As more Canadians returned to the housing market, financial institutions had the chance to establish relationships with a new generation of homeowners many of whom were entering the mortgage market for the first time. The fundamental question is where those borrowers ultimately chose to go.

Did you know?

Over the course of the year (March 2024 – March 2025), the prime rate fluctuated from 5% to roughly 2.75%.

Loyalty Meets the Mortgage Marketplace

When Canadians secure a mortgage, many instinctively turn to the financial institution they already know. According to the Switching Study, roughly six in ten mortgage customers obtained their mortgage through their primary financial institution. On the surface, this suggests a reassuring level of loyalty for incumbent banks, yet the remaining four in ten borrowers chose a different path, securing their mortgage through a lender that was not their primary FI.

of mortgage customers obtained their mortgage through their primary financial institution.

of borrowers chose a different path, securing their mortgage through a lender that was not their primary financial institution.

of the major Canadian banks recorded a positive gain in mortgage acquisition.

For traditional banks, that share of the market demands attention. Mortgages represent one of the most powerful entry points for new relationships, and losing that opportunity can mean losing far more than a single loan. Indeed, our data tell us that the majority of switchers open at least one other financial account or product with their new lender.

The competitive intensity in the mortgage market is reflected in the results. Among the major Canadian banks, only one of the Big 5 recorded a positive gain in mortgage acquisition during this period, a clear signal that even the largest institutions cannot rely solely on brand strength to win in this category. So, what matters most to borrowers?

The Unavoidable Importance of Rates

When Canadians evaluate mortgage lenders, one attribute consistently rises to the top: a competitive interest rate. This priority should surprise no one. Over the life of a mortgage, even a modest rate difference can translate into tens of thousands of dollars in additional interest payments. For households managing tight budgets and long-term financial commitments, the stakes are simply too high to ignore.

Borrowers therefore approach the decision with a pragmatic mindset. They compare offers carefully, assess potential savings, and ensure that the lender they choose provides a rate that aligns with their financial realities. Yet while rates may be the entry ticket to consideration, they are rarely the entire story.

Mortgage decisions are complex, and Canadians often look for additional signals of reassurance as they navigate the process. A trusted recommendation from a family member, a mortgage broker, or advisor can carry significant weight. A well-timed promotion may prompt further investigation. A clear, informative website can help borrowers understand their options, and perhaps most importantly, customers respond when lenders demonstrate that they genuinely want their business, through responsiveness, guidance, and a willingness to support them through a complicated financial decision. For lenders, the challenge is determining how to break through this dense web of influences and reaching prospective homeowners at the right moment.

Stability, Guidance, and the Canadian Mortgage Mindset

Canadian borrowers have historically approached mortgages with a blend of caution and pragmatism. While competitive pricing is essential, borrowers also place considerable value on stability and expertise. For first-time buyers in particular, the mortgage process can feel overwhelming. Questions about rates, amortization periods, prepayment privileges, and approval requirements often require explanation and reassurance. In these moments, the lender’s role extends beyond providing financing; it becomes a source of clarity and confidence.

This longstanding mindset continues to shape how Canadians evaluate mortgage providers today. Even as digital tools improve and comparison shopping becomes easier, many borrowers still seek guidance as they move through the process, and lenders who deliver on that need have a meaningful advantage.

The 2026 Switching Study is currently in-field (March 2026) and will provide updated insights into how these preferences are evolving. As the housing market and interest rate environment continue to shift, understanding these behavioural patterns will be critical for anyone competing effectively in mortgage acquisition.

The Delivery Channel Question

At the same time, the way Canadians interact with financial institutions is undergoing a profound transformation. One of the most striking findings from the 2025 Switching Study concerns the growing role of digital channels in the switching process. In 2025, more than half of all bank switching occurred online at 55%. Remarkably, this share is even higher than the levels observed during the height of the COVID-19 pandemic, when physical access to branches was significantly constrained.

of all bank switching occurred online in 2025.

of online switchers said their switching process occurred entirely online, from research through to account opening.

of switching activity occurred in person, though not all interactions were driven by customer preference.

Among those who switched online, the digital experience was often comprehensive. When asked how much of their switching journey took place digitally, 77% of online switchers said the process occurred entirely online, from research through to account opening. These figures raise an obvious question: is the branch becoming irrelevant?

The answer is more nuanced. While the shift toward digital channels is unmistakable, in-person interactions still play an important role. Roughly one-third of switching activity continues to occur in person, although these interactions are not always driven purely by customer preference. In some cases, customers may begin their journey online but complete it in a branch due to process requirements or documentation needs.

What is clear is that the channel mix varies significantly by product category. For everyday financial products such as chequing, savings, and investment accounts, the shift toward digital switching is particularly pronounced. Mortgages, by contrast, have historically involved more human interaction. Yet even here, the digital channel is gaining traction, with a surprisingly high share of mortgage customers completing substantial portions of their application journey online. For lenders, this means the customer experience must function seamlessly across both digital and physical environments.

Marketing in the Moment of Decision

While the application process itself matters, the battle for customers often begins much earlier. Across all media channels, two sources consistently stand out as the most influential in attracting new customers: the financial institution’s website and internet advertising.

The role of the website is particularly striking. Two-thirds of switchers report visiting the website of their new financial institution during their decision process, and the majority say that visit directly influenced their decision to act. In other words, the website is no longer just an informational resource, it is often the central platform where potential customers evaluate credibility, compare offers, and ultimately decide whether to proceed.

For financial institutions hoping to attract mortgage customers, this raises several critical questions. Does your website clearly communicate the value you offer borrowers? Does it guide visitors through complex decisions in a way that feels intuitive and trustworthy? And does your digital marketing strategy reach Canadians at the moment they begin exploring alternative lenders?

In a market crowded with promotions, advertisements, and rate comparisons, standing out requires more than simply offering competitive pricing. It requires understanding the triggers that prompt consumers to explore alternatives in the first place and designing marketing strategies that speak directly to those motivations.

Did you know?

Two-thirds of switchers report visiting the website of their new financial institution during their decision process, and the majority say that visit directly influenced their decision to act.

Competing for the Next Generation of Homeowners

The mortgage market remains one of the most strategically important battlegrounds in Canadian financial services. Winning a mortgage customer is rarely just about originating a loan; it is about establishing a relationship that may shape the customer’s financial life for decades, yet the path to winning that relationship is becoming more complex.

Consumers are increasingly comfortable exploring options beyond their primary financial institution. Digital channels have made comparison shopping easier than ever, and marketing messages compete in a crowded and rapidly evolving landscape.

For lenders, success will depend on their ability to align several critical elements: competitive pricing, clear and trustworthy guidance, seamless digital experiences, and marketing strategies that resonate at the precise moment Canadians begin their search for a home. The institutions that master this combination will not only capture mortgage market share, but they will also earn the long-term loyalty of the next generation of Canadian homeowners.