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How To Choose Between a Variable or Fixed Rate Mortgage

Posted onSeptember 17/2018By

The difference between fixed and variable rate mortgages has narrowed over the last few years. Fixed rate mortgages have the advantage of peace of mind, as the payments are fixed monthly. However, their rates have also been steadily increasing in recent years. In comparison, variable rate mortgages tend to be lower in their rates, but also include additional risks. As a result, determining which to go with can provide a nerve-racking and daunting task. Here, we will help you choose between a variable or fixed rate mortgage by assessing your risk tolerance, lifestyle, and income. Rewards vs Risk As mentioned,…

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3 Reasons Why A Low Mortgage Rate May Not Be All That It Seems

Posted onOctober 18/2017By

When shopping for a mortgage, the first thing everyone wants is a low mortgage rate. While it’s easy to get tempted by low rates, it’s still very important to do your research and make sure you won’t end up regretting your choice down the road. While there are many reputable companies that will secure you a low mortgage rate, there are also those who may prey on inexperienced home buyers. Here are some things to look out for when you spot a low mortgage rate: Discounts Some lenders may advertise a very low mortgage rate to catch your eye. But once you read the fine print, you may find that that rate is subject to change. Unless you are getting a fixed rate mortgage, you are essentially at the mercy of the banks. Many lenders offer a one or two year discount, but after those first couple years you may…

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All About Fixed Rate Mortgage Penalties

Posted onJune 19/2017By

Fixed rate mortgages are the most common, and the least risky, mortgage choice. As the name suggests, having a fixed rate mortgage means that you pay the same amount each month towards the principal, over the agreed-upon period of time. Many homeowners choose fixed rate mortgages so that rising interest rates won’t affect their monthly payments. Additionally, a fixed rate mortgage offers easier planning for monthly expenses. Often, fixed rate mortgage plans last two to three years, but you can also get longer ones that last five to ten years. Although fixed rate mortgages seem simple enough, there are some things to consider when choosing a mortgage, specifically what kind of penalties you may incur with a fixed rate mortgage. Fixed rate mortgages tend to be inflexible, and there are two main types of penalties you can incur… Early Redemption Penalty You may be subject to an early redemption penalty…

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How Mortgage Rates Are Determined in Canada

Posted onMay 08/2017By

For many Canadians, their home is the biggest investment they will ever make, and their mortgage the most significant loan. When shopping for a mortgage, people generally look for ways to get low mortgage rates. A mortgage rate doesn’t refer to the size of the mortgage loan, but rather the interest rate on your mortgage. Obviously before you buy, you’ll want to search for a low mortgage rate. There are many factors that affect mortgage rates in Canada, and a fuller understanding of these factors can be an immense help to the inexperienced buyer when applying for a mortgage. In this article, we’ll look at a basic outline of how mortgage rates are determined in Canada, including some ways to get a low mortgage rate. Fixed vs. Variable Rate Mortgages There are two kinds of mortgage loans available to Canadians: fixed or variable rate mortgages. A fixed rate mortgage, as…

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Which Factors Affect Mortgage Rates?

Posted onMarch 13/2017By

When it comes to mortgage rates in Canada, there are so many factors involved it can be hard to keep track. You’re probably aware that the Bank of Canada is a top player in how mortgage rates are determined, but there’s more to it than the BoC simply deciding what rate to set at any given time. Everyone is looking for a low mortgage rate, but the factors that affect variable mortgage rates are different than those that affect their fixed rate counterparts. Below, we’ll explore the differences. Variable mortgage rates A variable rate mortgage is a loan where the interest rate may change during the mortgage’s term. As the borrower, your monthly payment will be same, but if there is a low interest rate, you will still be able to take advantage of it. For example, if the interest rate increases, the amount of your monthly payment that is…

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