Right now rates are at an all time low, but as sure as the sun will rise, eventually so will interest rates. You need to know what kind of mortgage is right for you.
The advantage of a fixed rate mortgage is that the interest rate is set for the entire term of the mortgage. A fixed rate mortgage offers you the security of knowing exactly how much principle and interest you will be paying on your mortgage during the term selected. If you think that interest rates will rise in the near future, you may want to lock into a longer term fixed rate mortgage but if you think that the rates may fall, a shorter term may be the best choice for you. If rates are stable or going down, you may want to consider a variable rate mortgage.
With a fixed rate mortgage, however, you’re locked in for the term, whether that’s 1, 3, 5, 7 or 10 years, and that you may incur a penalty to break your mortgage. The mortgage term can be 15, 20, 25 or 35 years.
If you are considering a fixed rate mortgage keep the following options in mind to help to reduce your mortgage faster.
Choose a lender who offers you the flexibility to:
Most of the lenders we deal with, offer the above options. Let Cindy Janisch help you choose the best package for your needs.
The best long-term fixed rate mortgage for you will ultimately depend on your personal financial situation and goals. However, if you are looking for stability and the ability to budget for your future, a long-term fixed rate mortgage may be the right choice for you.
In Canada, the interest rate for a fixed mortgage is set by the lender, and can vary from one lender to another. The Bank of Canada’s overnight rate is also a major factor in determining fixed mortgage rates. The overnight rate is the rate at which banks lend money to each other overnight, and is influenced by the federal funds rate in the United States.
The most important factor in determining the interest rate for a fixed mortgage is the lender’s prime rate. The prime rate is the rate at which banks lend money to their best customers, and is influenced by the overnight rate. Other factors that can influence the interest rate for a fixed mortgage include the term of the mortgage, the size of the down payment, and the borrower’s credit score.