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AuthorSteve Garganis

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.
Posted 5 Comments on Mortgage Rate history…25 year chart Mortgage Rates

Mortgage Rate history…25 year chart

Here’s an updated 25 year Interest Rate Chart.   The chart gets updated monthly by Firstline Mortgages, a division of CIBC.   Click here to see the data.

The only surprise is that interest rates didn’t go up as many experts had predicted last year and earlier this year…  To sum up why in just one word……UNCERTAINTY…..  there is a lot of uncertainty about he global recovery and the domestic economy…. watch for interest rates to stay fairly flat through the rest of 2010….

Posted Mortgage Products

Taking a look at a 1 year and 3 year fixed rates

I’ve had some inquiries about taking a 1 year and 3 year fixed rate…and for good reason.   A 1 year fixed rate can be had for about 2.50% and a 3 year fixed rate is 2.90%.   This does make going with a shorter fixed term an attractive option if Bank Prime rate continues to increase.

Best Variable rate is around Prime less 0.65% or 0.70% for qualified applicants with some conditions….  that puts the Variable rate at 2.30% or 2.35%…

I like Variable rate mortgages for many reasons but these shorter, fixed terms can be a good alternative.. Make sure you understand all the terms and conditions… speak with a qualified Mortgage Broker.

Posted Mortgage Rates

Variable Rate is up 0.25%

Bank of Canada raised their Target Rate by 0.25% to 1.00%.   We will see the Retail Bank’s Prime lending rate go up from 2.75% to 3.00%.

Governor, Mark Carney, said “Any further reduction in monetary stimulus would need to be carefully considered in light of the unusual uncertainty surrounding the outlook,” .    This is sounding like we won’t see any further hikes til some time next year as the Government evaluates the economy and the global markets.

I still like Variable rate… at 2.30% to 2.50%, this is still much better than the 5 year fixed rate of 3.75%, which is what we are seeing today.

Posted Mortgage News

School’s in for Bank of Canada

To all the kids…. including my son…..”Have a great year at school.. make it fun… make it count”.

Tomorrow is the 6th of 8 scheduled meetings for 2010 by the Bank of Canada…a time when they set the Target Rate or Overnight Rate, which directly affects the Bank Prime Rate and your Variable Rate Mortgage.

The original plan called for Mark Carney, Governor of Bank of Canada, to raise interest rates steadily over the next year or so by as much as 3.00%… but it’s become a little tougher to make that move.

Less than impressive economic news in the U.S., Canada and the rest of the world has given concern about a double dip recession…. raising the rates during a period of uncertainty is risky business.   Right now, experts are calling for a 60% chance of a rate hike but then a pause to see how this will affect the economy.

Longer term forecasts have been amended for more modest rate hikes in 2011….  all good news for Borrowers…  stay tuned as we continue to monitor the latest reports…

Bottom line, new Variable rate mortgages can be had for around 2.05% to 2.10%… so even a 1.50% increase would  beat out a 5 year fixed rate….

Posted Mortgage News

When should I lock in my Variable rate mortgage?

A thought on the minds of many, with all the talk of ‘Historical low fixed mortgage rates’ and ‘rising Variable rates’.   “When should I lock in my Variable rate mortgage?”

Here’s a quick suggestion and rule that I follow… We only want to lock in our Variable rate mortgage when we think Variable rates will go way up and for an extended period of time…

But we must also look at what we can lock into… if you are in a 2.10% Variable rate mortgage, would you lock into a 3.89% fixed mortgage rate?   I’m not sure I would…. I think it will take a few years before my Variable rate mortgage approaches today’s Fixed rate…..  why pay more today when you don’t have to?

For me, I can’t see Variable rate mortgages underperforming Fixed Rates over the 12 to 17 years that it will take us to pay our mortgage off.  Having said that, we are always evaluating the Market Trends and will adjust our strategies when needed.  A mortgage is a huge debt and deserves a solid strategy to retire this debt with the lowest cost.

Ultimately, it will come down to risk tolerance, your personal budget and what you believe will be the better strategy.  Consult your Mortgage Broker to better understand the differences.

By the way, you might be interested in knowing that certain Banks and Trust companies have recently started to pay us more to offer fixed rate mortgages over Variable rate Mortgages…Good Mortgage Brokers don’t let the compensation dictate which product they recommend.  They recommend what they believe is right for the client.