CIBC says..a hike in Bank Prime rate coming…and new mortgage rules won’t affect most of us.
BANK PRIME RATE FORECAST
The CIBC’s Senior Economist, Ben Tal, says Bank Prime rate will start to increase this summer… but only by 0.50% to 0.75% by end of the year… and then will pause in 2011 to see where the U.S. rates are headed…. click here Feb 26 2010 CIBC Forecast.
Mr. Tal thinks this is “risk move” pointing to similar Bank of Canada action in 1992 and 2002 when the Bank hiked rates only to reverse the decision a few months later…
Mr. Tal also points out that real inflation is around 1.5% and will continue to remain low into 2011.
Does this mean we should lock in our variable rate mortgages? For most of us, probably not… but if you aren’t sure, then speak with your Mortgage Broker.
NEW MORTGAGE RULES EFFECT
Mr. Tal sees the new mortgage rules having little effect on most of us. Here are his calculations…
- Increase down payment requirement for refinancing: 7%-8%
- Increase down payment requirement for non-primary residence: 2%-3%
- Increase qualifying rate on variable mortgages: 5%-6%
This is the first outlook I have seen…and it’s really not bad at all… Enjoy the weekend… and GO CANADA GO!
Mortgage News, Mortgage Rates, Mortgage Trends, Rate forecast
Steve Garganis View All
As an industry insider, Steve will share info that the BANKS don't want you to know. Steve has appeared on TV's Global Morning News, CBC's "Our Toronto" and The Real Life TV show. He's also been quoted in several newspapers such as the Globe and Mail, The Toronto Star, The Vancouver Sun, The Star Phoenix, etc.
Oh! This is awesome! Thanks for dispelling severalsome
misconceptions I had read about this as of late.
There is a lot of misinformation floating around… we will always report accurate news… and will voice our opinion… thank you.. SG