Rate change

Last night I received notification from several of my lenders that they were reducing their 5 year fixed rate. Depending on the lender reductions were anywhere from 10 to 40 basis points. Remember one hundred basis points = 1%. However you know what did not change? The variable rates did not change. This is because the variable rates are based on the bank of Canada prime lending rate and the fixed rates are based on bond yields.

If you are renewing your mortgage or buying a new home, I always ask my clients if this will be your forever home. If the answer is yes then there is nothing wrong with the fixed rates. However most 5 year mortgages are broken around the 38 month mark of the 60 month term. If you are on a fixed rate this will possibly trigger a large interest rate differential penalty.

Since the Bank of Canada meets only 8 times a year to discuss monetary policy and the last time they increased the prime lending rate was Oct 30th of 2018, I am putting my own mortgage on variable this time. This along with the fact that if I needed to break it at any time the penalty will be only 3 months interest. The choice is yours to make, as your trusted advisor I supply you with the information you require to make the best decision.

Today I am thankful for the kindness of strangers at Costco this morning, my dog seeing his favourite other dog on our morning walk and funny texts from my brother on his birthday.

“The world as we have created it is a process of our thinking. It cannot be changed without changing our thinking.” -Albert Einstein

I look forward to hearing from you in regard to your mortgage needs.

Patrick

p.s- You can click on this link to start the process whenever you are ready. Schedule your meeting with me here.

p.s.s- I should tell you that I am licensed in Nova Scotia, Ontario(M18001555) & in British Columbia(BCFSA #504098).

p.s.s.s You can download my new mortgage app here