Is it time to fix your mortgage?

Variable rate mortgages have been the choice for many Canadians over the last decade or so. Many Canadians have benefited over the years by having a variable rate mortgage and therefore saving thousands in interest cost.

Times have changed. Variable mortgages are now around the 3% mark but 3 and 4 year term fixed rates are as low as 3.09%. The question of course is when are the prime lending rates going up? Of course no one knows for sure and while the European sovereign debt crisis continues to loom large, most believe that it is only a matter of time before the whole crisis is in the rear view mirror. It’s been decades since the short term variable rates were so closely aligned with fixed rate mortgages and of course it won’t last.

Your current mortgage situation is not like everyone else’s. Does it make sense for you to finally go fixed? Only by reviewing your current mortgage situation can we decide if it’s the right decision for you. I can also show you how to save thousands in interest cost at the same time and have your mortgage paid years sooner.

Remember it is not just the interest rate you have but the interest you actually pay that matters most.

Call me today and let’s get started.

Don't Believe all The Economic Headlines: CIBC

Here's a report from Propertywire magazine that |I felt should be copied word for word. If you have any questions contact me .
A new report from CIBC Economics suggests that Canadians would be well advised to look at the full picture when reflecting on the housing industry. Simply, don’t be put off by the alarming headlines, but know the whole story- and all the details.
CIBC said in a report, “That is certainly the case when it comes to the highly debated ascent in household debt and the health of the Canadian residential real estate market. In both cases, any statement based on headline figures or average numbers can be hugely misleading. The truth is buried in the details—and there the picture is still not pretty, but much less alarming.”
While household debt levels in the country are high, they suggest they are not alarming. Data has put debt-to-income ratio at around 150%. CIBC says though, that that figure cannot be taken at face value. It has to be put in greater context- of the whole economy, saying that it is not the level of debt that is as important as the fact that the accumulation of debt has greatly decelerated. Canadians seem to be changing their attitudes towards debt, and are adopting appropriate behaviours to that end.
Like RE/MAX earlier this week, CIBC says that the stellar performance of the Canadian Housing market is a bit of a puzzler, when conventional wisdom and economic factors suggest that it should be taking a greater hit than it has. “The average price of a house has risen by 28% since reaching its recent cyclical low in January 2009, and it is now close to 50% above the level seen before the recession.”
What CIBC does underscore, is the dangers of identifying the national average price, as actually reflecting the average price in the nation. They centre on areas like Toronto and Vancouver, where high prices succeeded in skewing the national average. They remind Canadians that they housing market is made up of separate pieces, each with unique challenges and conditions. “Prices in the Canadian market and its sub-segments are higher than what can be explained by factors such as income growth, rent, and household formation.”

CIBC answers doomsday analysts who say that the market is overvalued, and set to crash, because there exist fundamentals to keep it afloat: “The fact that prices are overvalued today does not necessarily mean that they will crash tomorrow. After all, a violent market correction needs a trigger such as the sub-prime crisis, which ignited the US real estate meltdown, and/or abnormally high interest rates, as was the case during the 1991 property crash in Canada.”

Bank of Canada maintains overnight rate target at 1 per cent

Good news for people with variable rate mortgages. Your bank prime rate will not be going up this session.

OTTAWA – The Bank of Canada today announced that it is maintaining its target for the overnight rate at
1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.
Uncertainty around the global economic outlook has increased in the weeks since the Bank released its
October Monetary Policy Report (MPR). Conditions in global financial markets have deteriorated as the
sovereign debt crisis in Europe has deepened. Additional measures will be required to contain the European
crisis. The recession in Europe is now expected to be more pronounced than the Bank had anticipated in
October, as a result of increased deleveraging and tighter financial conditions, as well as necessary fiscal
austerity and structural reforms. For more information and to discuss whether a variable rate or fixed rate is best for you contact me

Variable-rate mortgages are so over.

Rob Carrick, the Personal Finance writer for the Globe and Mail says that with the variable rate mortgages being sold at prime which is 3% why would anyone want this product. There are 4 year fixed rate mortgages available on the market now at 3% or3.09% so why take the risk. Rates are not going to go down so for the first time in 10 years Carrick is saying go fixed rate. If you want to discuss variable vs fixed rate and how it would affect your monthly payments call me and we'll talk.

Crystal Ball Time - no rate increases until Q3 2012

Reuters News agency just released a poll of 40 economists that shows that most economists believe that interest rates will not go up until the third quarter of 2012. This means that people with variable rate mortgages will be able to keep their low rates for another 9-12 months. The vast majority of these economists lowered their expectation of a rate hike for the next 4 quarters.
Economists often do not agree but 95% of them feel that rates will stay the same at the next announcement for the Bank of Canada Overnight rate scheduled for the end of October. This is based on the belief that Canada's economy will continue to weather the recession storm. In addition they expect inflation to remain low so a rate increase to slow the economy will not be necessary. If you are thinking about going for a variable rate mortgage you should know that lenders lowered the discount on their mortgages from Prime rate - .40% to Prime -.10% this week. The difference between a fixed rate and a variable rate now stands at .39%.
If you want to talk to someone about which rate would be best for you, contact me and we'll review your particular situation and you can make an informed choice.

o you have a variable rate mortgage or do you know anyone that does? They could be paying a lot more than they need to.

Prime rates have fallen or remained steady over the last two years and with the latest Bank of Canada decision (April 12th) still unchanged at 1%, most banks prime rates are still at 3%. If you or anyone you know has a variable mortgage that was taken over the last several years chances are they are paying too much and will continue to pay more unnecessarily…why?..... because.. a lot of variable mortgage taken out a few years ago were at prime plus .5% or even plus .75% meaning the rate would be 3.5% to 3.75%!! Today’s variable mortgage are priced at Prime minus .60%.. meaning your rate could go from 3.75% to 2.40%.. That’s a difference of 1.5% which could easily save you thousands and thousands over the next few years even with the penalty to discharge.

With interest rates expected to remain low over the next little while, there is no better time to have a look at your own mortgage and switch or refinance your mortgage along with your other debt into one easy payment. Your mortgage amount might be higher but I can show you how to pay it off years sooner while keeping your monthly cash flow the same which means even greater savings.

Call or email me today and let me show you how this is all possible through Choice, Convenience and Counsel that a true mortgage professional like myself can offer because……why pay more than you have to…. Visit my website to apply.

Bank of Canada signals no interest rate increases for a while

Governor Carney said yesterday that “given current material headwinds, the policy rate can return to its long-run level after inflation is projected to reach the 2 per cent target and output is projected to reach its potential”, highlighting the lack of urgency to tighten. The Bottom Line: Despite the upside surprise to core inflation, the Bank of Canada appears in no rush to tighten given the economic and financial market headwinds that are currently blowing. Low rate environment is here to stay for now. On the downside, low rates mean increase speculation and rising home prices. If you want to take advantage of these low rates and renew your mortgage early contact me to find out how much you can save.