Canadian housing mortgage rates are all over the map. Don’t get trapped in an unnecessarily costly mortgage agreement.
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Life Insurance vs. mortgage insurance: Let’s break it down + MORE Mar 20th
Life insurance can be a necessity for ensuring your loved ones are taken care of after you’re gone. It can help them pay for funeral expenses, the costs of everyday living and much more. But one of life insurance’s main advantages is that it can pay off outstanding debts, including a mortgage. S.... More »
Lessons From the 2018 Digital Mortgage Conference – Part I + MORE Sep 21st
“If you don’t view yourself as a technology company that does mortgages, you’re missing it.”—Bill Emerson, Vice Chairman, Quicken Loans That quote encapsulated this week’s third annual Digital Mortgage Conference in Las Vegas. To compete in the next decade, brokers and lenders wil.... More »
Opinion: When competition crosses a line in mortgage brokering Oct 16th
Every so often, a situation comes along that reminds us of a darker side of mortgage brokering. Most of the time, competition is healthy. But sometimes, it crosses a line; not legally, but ethically..... More »
Should you get a fixed-rate or variable mortgage? In these strange times, fixed has a rare edge Nov 23rd
With rates this low, the usual advantages of renewing with a variable mortgage are diminished or gone, writes David Aston..... More »
Ontario review recommends expanding lender access for Level 1 mortgage agents + MORE Feb 7th
Finance ministry report adopts key industry recommendations and could expand where Level 1 agents can place insured mortgages.... More »
Variable Rate War Heating Up
– canadianmortgagetrends.com
Mortgage shoppers looking to get a variable rate are in luck. The country’s biggest banks are currently slashing rates and clamouring for their business. A week after BMO announced its 2.45% variable mortgage rate promo (prime – 1.00%) for new and existing clients, TD responded by matching the rate at a discount of prime – […]
A number of Canadian lenders have slashed their variable mortgage rates in recent days, even as some of those same lenders are raising their fixed-rate mortgages.
And the Variable Rate price wars begin… Here’s how you can benefit!
– canadamortgagenews.ca
In order to fully understand how to take advantage of record-low variable rates, it’s important to learn some mortgage history.BMO came out swinging first a week ago with a variable rate of Prime minus 1.00%. Historically, when a BIG SIX BANK comes out with a huge price decrease, it’s only for a very short time – likely 2-3 weeks. But, during that time, they can gain massive volumes and satisfy their market share requirements from the average borrower.
With all the talk of interest rates going up, this is welcome news for borrowers. Last week, I wrote about Variable rates at Prime minus 1.09%. This week, the banks have caught on.
Let’s look at these rates more closely. Prime minus 1.00% equals a rate of 2.45%. Compare this with a five-year fixed rate that ranges between 3.34% and 3.69% and that’s quite the savings.
An old rule of thumb comes into play here…
For years, I’ve had a simple rule that I’ve followed regarding when to choose variable over fixed…
