Fixed Mortgages Rates Have Risen Slightly, What About The Variable Rate?
Fixed Mortgages Rates Have Risen Slightly, What About Variable Rate Mortgages?
This week we saw fixed mortgage rates increase slightly with the increase in bond yields to maintain spreads. We are still not far off record lows however, so not too much should be made of this increase I believe, yet. This can be a friendly reminder though that current rates will not last forever and if one is planning on buying, upgrading, or refinancing, there will be savings if done sooner than later. I will of course follow this by saying that one’s decisions should always make sense for them and no one should feel overly rushed for the largest purchase of their life or in a transaction of this magnitude.
Variable rate mortgages however, and specifically bank’s prime lending rate, is forecast to remain low for the foreseeable future. The Bank of Canada meets later this month and all signs point to them leaving the rate unchanged. Economists are also still comfortable forecasting that the Bank of Canada rate and prime, will remain at current levels through to July 2010.
The above combine to widen the gap in terms of rate between current variable rate mortgages and comparable fixed rate mortgages. This may make it more difficult for consumers to decide which one to choose in that the current low rate of the variable is enticing, however, for mortgages most people find comfort in knowing their rate and therefore what their payment will be over the term they choose. An Accredited Mortgage Professional (AMP) can help you by asking the important questions to distill out what is your preference and comfort level, combined with how can you best take advantage of rates and other mortgage options today to save and pay down your mortgage faster.
For more information and help with products and mortgage options, please contact me at anytime.
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