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Should you look at 10 year fixed rate mortgages?

Fixed rate mortgageToday, right now, we are experiencing all-time record low fixed mortgage rates.  Great news if you need a mortgage.  And some of you may be thinking of locking into a longer term mortgage.   Let’s take a look at that option.

Going longer could be an option for some.  The Best 5 yr fixed  is around 2.59%.. some special deals exist for larger mortgages or faster closings… but let’s use 2.59% for now.   Does it make sense to pay 0.30% more for the first 3 years of your mortgage, just for the benefit of knowing what your rate will be for the last 2 years?

(a warning… you’ll see lower rates advertised.. but be careful.  There are so many NO FRILLS products or products that carry inflated penalty calculations, limited repayment options and other hidden fees.. stay away from those)

Not for me..

You can get a 2 yr fixed rate for 2.14% and a 3 yr fixed rate for 2.29%.


Here’s something that I’m being asked about these days…should we consider a 10 yr term?   First, a funny story.. There’s a well-known Mortgage Professional out there, whom shall remain nameless…that recommended 10 yr fixed products for his clients for many, many years.

I always questioned this philosophy.  Nowhere in history does it show that long-term fixed rates are the better option.  It’s not the case.    Somehow, he convinced the majority of his clients to take a 10 yr fixed rate product.. Crazy.. each of those clients paid $$thousands in higher interest costs.  It’s really too bad.

Today is no different.  The Best 10 yr fixed rate product is 3.84%.   So, can you imagine paying 1.25% more, each year, for the first 5 years of your mortgage, just for the benefit of knowing what your rate will be for the next 5 years?  Me neither.

By the way, that Mortgage Professional recommending 10 yr fixed rates all those years is still around and very successful.  Go figure…


Your best interest is my only interest.   I reply to all questions and I welcome your comments.  Like this article?  Share with a friend.

Steve Garganis 416 224 0114

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.

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